Court Opinion

ID: 2960652
Source: CourtListenerOpinion
Date Created: 2015-09-17 19:07:59.468791+00
Date Added: 2024-06-11T15:26:17.302042
License: Public Domain

IN THE SUPREME COURT OF MISSISSIPPI

                      NO. 2013-IA-00728-SCT

HANCO CORPORATION

v.

PATRICIA GOLDMAN, TIMOTHY KELLY,
NANCY KELLY, AND JONATHAN W. KELLY,
WRONGFUL DEATH BENEFICIARIES OF
WAYNE KELLY, DECEASED

DATE OF JUDGMENT:           04/16/2013
TRIAL JUDGE:                HON. BILLY JOE LANDRUM
TRIAL COURT ATTORNEYS:      JAMES L. QUINN
                            LEONARD BROWN MELVIN III
                            SAMUEL STEVEN McHARD
                            ROBERT O. ALLEN
                            S. ROBERT HAMMOND, JR.
COURT FROM WHICH APPEALED: SECOND JUDICIAL DISTRICT OF THE
                            CIRCUIT COURT OF JONES COUNTY
ATTORNEYS FOR APPELLANT:    ROBERT O. ALLEN
                            WILLIAM ROBERT ALLEN
                            JOHN CHADWICK WILLIAMS
                            S. ROBERT HAMMOND, JR.
ATTORNEYS FOR APPELLEES:    SAMUEL STEVEN McHARD
                            PAUL MANION ANDERSON
                            MARCUS ALAN McLELLAND
                            LEONARD BROWN MELVIN III
NATURE OF THE CASE:         CIVIL - PERSONAL INJURY
DISPOSITION:                AFFIRMED AND REMANDED - 09/17/2015
MOTION FOR REHEARING FILED:
MANDATE ISSUED:

                     CONSOLIDATED WITH

                      NO. 2013-IA-00731-SCT
PATRICIA GOLDMAN, TIMOTHY KELLY,
NANCY KELLY AND JONATHAN W. KELLY,
WRONGFUL DEATH BENEFICIARIES OF
WAYNE KELLY, DECEASED

v.

AMERICAN AIR SPECIALISTS OF MISSISSIPPI,
INC. AND HANCO CORPORATION

DATE OF JUDGMENT:                        04/16/2013
TRIAL JUDGE:                             BILLY JOE LANDRUM
COURT FROM WHICH APPEALED:               SECOND JUDICIAL DISTRICT OF THE
                                         CIRCUIT COURT OF JONES COUNTY
ATTORNEYS FOR APPELLANT:                 ROBERT O. ALLEN
                                         WILLIAM ROBERT ALLEN
                                         JOHN CHADWICK WILLIAMS
                                         S. ROBERT HAMMOND, JR.
ATTORNEYS FOR APPELLEE:                  SAMUEL STEVEN McHARD
                                         PAUL MANION ANDERSON
                                         MARCUS ALAN McLELLAND
                                         LEONARD BROWN MELVIN III
NATURE OF THE CASE:                      PERSONAL INJURY
DISPOSITION:                             AFFIRMED AND REMANDED - 09/17/2015
MOTION FOR REHEARING FILED:
MANDATE ISSUED:

      BEFORE DICKINSON, P.J., KITCHENS AND CHANDLER, JJ.

      KITCHENS, JUSTICE, FOR THE COURT:

¶1.   Wayne Kelly was killed while working at a construction site in Hattiesburg,

Mississippi. His family (the Kellys) sued, among other defendants, Hanco Corporation, Inc.

(Hanco), the general contractor for the project on which Wayne Kelly had been working at

the time he died, and American Air Specialists of Mississippi, Inc. (American Air), the

subcontractor that had leased the services of Kelly and his coworkers from Landrum

Professional Employer Services, Inc. (Landrum). The Kellys and Hanco/American Air

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moved separately for summary judgment. The circuit court denied summary judgment to

Hanco and American Air. Hanco filed a petition for interlocutory appeal and the Kellys filed

a cross-petition for interlocutory appeal. This Court granted interlocutory appeal and

consolidated the cases. Although Section 71-3-9 of the Mississippi Workers’ Compensation

Act provides the exclusive remedy to claimants seeking compensation for on-the-job injuries,

this Court affirms the denial of summary judgment because Hanco waived its exclusive-

remedy affirmative defense.

                        FACTS AND PROCEEDINGS BELOW

¶2.    In September 2007, Saddle Creek Corporation of Lakeland, Florida, entered into a

contract with Hanco Corporation (Hanco) of Hattiesburg, Mississippi, to construct a cross

dock distribution facility at the Forrest County Industrial Park. Hanco subcontracted with

American Air Specialists, Inc. (American Air), on November 30, 2007. The subcontract

specified that the role to be performed by American Air was to provide all labor, materials,

and equipment required for the installation of the HVAC, including fans and louvers,

plumbing, site utilities, and design and engineering for the new facility. The subcontract also

required that American Air carry workers’ compensation and employers’ liability insurance

and that American Air provide Hanco “with valid certificates of insurance prior to

commencement of work verifying that insurance requirements and limits have been met.”

¶3.    At the time it subcontracted with Hanco, American Air had an agreement with

Landrum Professional Employer Services, Inc. (Landrum), of Pensacola, Florida. This

agreement was executed March 9, 2007, and was to continue “in full effect from such date

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for a period of one (1) year, and from year to year thereafter” unless cancelled by either party

upon provision of thirty days’ prior written notice. The agreement made Landrum employees

available to American Air for lease and allowed Landrum “a right of direction and control

over jobsite employees, including a right to hire, terminate, discipline, and reassign jobsite

employees assigned” to American Air. Further, American Air “maintain[ed] primary

responsibility for interviewing, hiring, assigning, and setting salary and benefits for jobsite

employees.” Landrum was required to furnish workers’ compensation insurance, but

American Air was to provide a “general liability insurance policy with a minimum

requirement of one million dollars ($1,000,000) combined single limit.”

¶4.    In accordance with the Landrum-American Air agreement, Landrum provided a

Liberty Mutual workers’ compensation policy for employees “leased to but not

subcontractors of American Air Specialists of MS, Inc.,” the term of which was January 1,

2008, through January 1, 2009. A certificate of insurance was issued, and Hanco was named

as certificate holder. Additionally, American Air took out a general liability policy in the

amount of $1,000,000 per occurrence from The State Auto Insurance Companies. As with

the workers’ compensation policy, the holder of the certificate of insurance on the general

liability policy was Hanco.

¶5.    Wayne Kelly, Leonardo Navarro Diaz, and Brandon E. Rathbone1 died on March 21,

2008. Kelly and his coworkers were connecting sewer lines at a construction site for a

distribution facility being built in Hattiesburg when the trench in which they were working

       1
           Kelly’s coworkers, Diaz and Rathbone, are not parties to the instant lawsuit.

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caved in and buried the three men beneath wet dirt and clay. On November 8, 2010, Wayne

Kelly’s wife, Nancy, and his children, Patricia Goldman, Timothy Kelly, and Jonathan W.

Kelly (the Kellys), filed suit against multiple defendants, including Hanco and American Air,

in the Circuit Court of the Second Judicial District of Jones County, alleging negligence as

the proximate cause of Wayne Kelly’s death. Because the regulations of the Occupational

Safety and Heath Administration (OSHA) allegedly had been violated by the defendants, the

Kellys filed a combined motion for summary judgment on liability against Hanco and

American Air on January 29, 2013. Hanco and American Air then moved for summary

judgment, respectively, arguing that the Mississippi Workers’ Compensation Act, Mississippi

Code Section 71-3-9 (Rev. 2011), provided the exclusive remedy available to the Kellys,

since Liberty Mutual had paid workers’ compensation benefits.

¶6.    On April 16, 2013, the circuit court denied summary judgment to Hanco and

American Air, reasoning that “genuine issues of material fact remain, and it would be

premature for the Court to grant Summary Judgment at this time.” On May 6, 2013, Hanco

filed its petition for interlocutory appeal in this Court. The Kellys filed a cross-petition for

interlocutory appeal that same day, arguing that the circuit court had erred in failing to

determine that the affirmative defense of exclusivity had been waived as a matter of law.

¶7.    This Court granted an interlocutory appeal to Hanco on September 4, 2013, and

consolidated the appeal with the Kellys’ cross-petition for interlocutory appeal. That same

day, this Court granted the Kellys’ cross-petition for interlocutory appeal, which this Court

ordered consolidated with the Hanco interlocutory appeal.

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¶8.    Hanco claims on interlocutory appeal that the trial court erred in failing to apply the

exclusivity provision of the Mississippi Workers’ Compensation Act, Mississippi Code

Section 71-3-9 (Rev. 2011). Finding that to be a dispositive issue, we address only the

following question: whether, under the Horton Doctrine, Hanco waived its exclusive-remedy

affirmative defense by actively participating in the litigation for twenty-six2 months without

pursuing the enforcement of that affirmative defense. See MS Credit Center, Inc. v. Horton,

926 So. 2d 167 (Miss. 2006).

                                STANDARD OF REVIEW

¶9.    This Court employs a de novo standard of review when reviewing a trial court’s grant

or denial of summary judgment. WW, Inc. v. Rainbow Casino-Vicksburg Partnership, L.P.,

68 So. 3d 1290, 1292 (Miss. 2011). Motions for summary judgment must be granted “if the

pleadings, depositions, answers to interrogatories and admissions on file, together with the

affidavits, if any, show that there is no genuine issue as to any material fact and that the

moving party is entitled to a judgment as a matter of law.” Id. (citing Miss. R. Civ. P. 56(c)).

“The party moving for summary judgment bears the burden of showing that no genuine issue

of material fact exists.” Id. (citing Bennett v. Hill-Boren, P.C., 52 So. 3d 364, 368 (Miss.

2011)). The burden then shifts to the nonmoving party: “[t]he non-moving party must

       2
        The Kellys assert a twenty-eight month delay, measured ostensibly from the filing
of their complaint (November 8, 2010) to the filing of Hanco’s motion for summary
judgment (March 1, 2013). We find that just over twenty-six months elapsed between
Hanco’s filing of its answer and defenses (December 22, 2010) and its filing of a motion for
summary judgment (March 1, 2013).

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produce specific facts showing that there is a genuine material issue for trial.” Id. (citing Van

v. Grand Casinos of Miss., Inc., 767 So. 2d 1014, 1018 (Miss. 2000)).

                                        DISCUSSION

¶10.   In 2006 this Court held that:

       A defendant’s failure to timely and reasonably raise and pursue the
       enforcement of any affirmative defense or other affirmative matter or right
       which would serve to terminate or stay the litigation, coupled with active
       participation in the litigation process, will ordinarily serve as a waiver.

Horton, 926 So. 2d at 180. The Kellys argue that Hanco should be afforded no immunity

under the exclusivity provision of the Mississippi Workers’ Compensation Act because it

“waived that defense as a matter of law” by actively participating in the litigation for twenty-

eight months prior to filing a summary judgment motion.

¶11.   The issue before this Court in Horton was whether the defendant had waived the right

to require arbitration pursuant to an arbitration clause in an employment contract. Id. at 173.

The defendant in Horton had delayed pursuing its “right to compel arbitration for eight

months (over 240 days)” and this Court held:

       [A]bsent extreme and unusual circumstances—an eight month unjustified
       delay in the assertion and pursuit of any affirmative defense or other right
       which, if timely pursued, could serve to terminate the litigation, coupled with
       active participation in the litigation process, constitutes a waiver as a matter
       of law.

Id. at 181. The Court explained in a footnote that “[t]o pursue an affirmative defense or other

such rights, a party need only assert it in a pleading, bring it to the court’s attention by

motion, and request a hearing.” Id. at 181 n.9 (emphasis added).

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¶12.   The parties dispute whether the exclusivity provision of the Workers’ Compensation

Act constitutes an affirmative defense. Affirmative defenses, according to this Court, hinge

upon “the nature of a defendant’s pleading”:

       A matter is an “avoidance or affirmative defense” only if it assumes the
       plaintiff proves everything he alleges and asserts, even so, the defendant wins.
       Conversely, if, in order to succeed in the litigation, the defendant depends
       upon the plaintiff failing to prove all or part of his claim, the matter is not an
       avoidance or an affirmative defense. A defendant does not plead affirmatively
       when he merely denies what the plaintiff has alleged.

Hertz Commercial Leasing Div. v. Morrison, 567 So. 2d 832, 835 (Miss. 1990). The

exclusivity provision of the Mississippi Workers’ Compensation Act, Section 71-3-9,

provides that:

       The liability of an employer to pay compensation shall be exclusive and in
       place of all other liability of such employer to the employee, his legal
       representative, husband or wife, parents, dependents, next-of-kin, and anyone
       otherwise entitled to recover damages at common law or otherwise from such
       employer on account of such injury or death . . . .

Miss. Code Ann. § 71-3-9 (Rev. 2011). The exclusivity provision meets the definition of an

affirmative defense because, irrespective of whether the plaintiff proves “everything he

alleges and asserts,” the defendant still wins.

¶13.   In Grimes v. Warrington, this Court considered whether the failure of the defendant

physician to assert a defense of immunity under the Mississippi Tort Claims Act (MTCA)

for five years, during which the defendant physician actively participated in the litigation

process, constituted a waiver under Horton. Grimes v. Warrington, 982 So. 2d 365, 369

(Miss. 2008). In that case, the plaintiff filed a complaint against the defendant physician on

June 4, 2001. Id. at 370. The defendant timely filed an answer on June 27, 2001, to the

                                               8
plaintiff’s complaint in which he asserted tort-claims immunity, but waited until August 3,

2006, more than five years later, to pursue a motion for summary judgment on the basis of

the MTCA. Id. The defendant actively participated in the litigation as well: “the case was set

and twice reset for trial, experts were designated and deposed on the merits of the negligence

claim, and Dr. Warrington filed a motion in limine to exclude part of Grimes’s expert’s

testimony.” Id. This Court therefore reversed and remanded the case for trial on the merits.

Id.

¶14.   Similarly, in East Mississippi State Hospital v. Adams, we considered whether

defendants had waived insufficiency of process and insufficiency of service of process

defenses “by failing to pursue them until almost two years after they raised them in their

answer while actively participating in the litigation.” East Mississippi State Hosp. v. Adams,

947 So. 2d 887, 890-91 (Miss. 2007). Because “defendants participated fully in the litigation

of the merits for over two years without actively contesting jurisdiction in any way” and

because the defendants “participated fully in discovery,” this Court held that defendants had

waived their affirmative defenses. Id. at 891. This Court therefore affirmed the trial court’s

denial of defendants’ motion to dismiss. Id.

¶15.   In the present case, the Kellys filed their complaint on November 8, 2010. Hanco filed

its answer and defenses on December 22, 2010, in which it claimed the Workers’

Compensation Act constituted an exclusive remedy. Hanco did not raise the exclusivity

provision again until it filed a motion for summary judgment on March 1, 2013. The record

reflects that Hanco actively participated in litigating the merits of the case. Hanco filed

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motions to join various motions of codefendants. Hanco designated experts it planned to call

at trial. Additionally, as did the defendant physician in Grimes, Hanco actively participated

in numerous depositions. Grimes, 982 So. 2d at 371.

¶16.   Hanco failed to file its motion for summary judgment until more than twenty-six

months after it had raised the exclusive-remedy provision in its answer to the Kellys’

complaint. The record suggests no “extreme and unusual circumstances” which would

explain or justify this delay. Hanco had abundant opportunity to assert the affirmative

defense. As in Horton, “if timely pursued,” the exclusive-remedy provision “would serve to

terminate or stay the litigation.” Horton, 926 So. 2d at 180, 181. Instead, Hanco actively

participated in the litigation by joining motions of other codefendants, designating expert

witnesses it planned to call at trial, and participating in depositions of witnesses. Although

it did assert the exclusive-remedy defense in its answer, Hanco did not “bring it to the court’s

attention, and request a hearing” until it filed its summary judgment motion more than

twenty-six months later. Horton, 926 So. 2d at 181 n. 9.

                                       CONCLUSION

¶17.   Because Hanco waived the affirmative defense of the exclusivity provision of Section

71-3-9, the judgment of the Circuit Court of the Second Judicial District of Jones Count

denying summary judgment is affirmed, and these cases are remanded for further

proceedings.

¶18.   AFFIRMED AND REMANDED.

     WALLER, C.J., DICKINSON AND RANDOLPH, P.JJ., LAMAR, CHANDLER,
PIERCE, KING AND COLEMAN, JJ., CONCUR.

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