Court Opinion

ID: 4349193
Source: CourtListenerOpinion
Date Created: 2018-12-11 16:09:03.567979+00
Date Added: 2024-06-11T14:21:45.743569
License: Public Domain

FILED
                                                                              Dec 11 2018, 9:04 am

                                                                                   CLERK
                                                                               Indiana Supreme Court
                                                                                  Court of Appeals
                                                                                    and Tax Court

      ATTORNEYS FOR APPELLANT                                   ATTORNEY FOR APPELLEE
      Robert J. Konopa                                          Kevin W. Kearney
      Eric W. von Deck                                          Hunt Suedhoff Kalamaros, LLP
      Elizabeth A. Klesmith                                     South Bend, Indiana
      Tuesley Hall Konopa LLP
      South Bend, Indiana

                                                  IN THE
          COURT OF APPEALS OF INDIANA

      Eshanya Walls,                                            December 11, 2018
      Appellant-Plaintiff,                                      Court of Appeals Case No.
                                                                18A-CT-266
              v.                                                Appeal from the Elkhart Superior
                                                                Court
      Markley Enterprises, Inc.,                                The Honorable Stephen R.
      Appellee-Defendant.                                       Bowers, Judge
                                                                Trial Court Cause No.
                                                                20D02-1605-CT-105

      Pyle, Judge.

                                        Statement of the Case
[1]   Eshanya Walls (“Walls”) filed a complaint against Markley Enterprises, Inc.

      (“Markley”), alleging that she was injured while working at Markley due to

      Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018                             Page 1 of 13
      Markley’s negligence. Markley filed a motion to dismiss under Indiana Trial
                         1
      Rule 12(B)(1), and the trial court dismissed Walls’ complaint for lack of subject

      matter jurisdiction, finding that Walls’ negligence claim was barred by the

      exclusive remedy provision of the Indiana Worker’s Compensation Act (“the

      Act”). On appeal, Walls argues that the trial court erred in dismissing her

      complaint. Using the statutory definition of “employer” set forth in INDIANA

      CODE § 22-3-6-1(a), we conclude that Walls was an employee of both Markley

      and the temporary staffing agency that placed her with Markley, and that the

      trial court properly dismissed Walls’ action under Trial Rule 12(B)(1) because

      her exclusive remedy rests with the Act.

[2]   We affirm.

                                                       Issues
               1. Whether the trial court erred in dismissing Walls’ complaint
               for negligence against Markley for lack of subject matter
               jurisdiction.

               2. Whether terms of the agreement between the temporary
               staffing agency and Markley amounted to Markley’s waiver of
               the exclusive remedy provision of the Act.

      1
        Markley initially filed a motion for summary judgment, which the trial court treated as a motion to dismiss
      for lack of subject matter jurisdiction under Indiana Trial Rule 12(B)(1).

      Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018                             Page 2 of 13
                                                      Facts
[3]   Markley is a corporation which maintains an assembly plant in Elkhart County,

      Indiana. Bridge Staffing, Inc. (“Bridge”) is a temporary staffing agency that

      “assign[s] employees to perform services for client companies, and provid[es]

      related management and human resource services.” (App. Vol. 2 at 142). On

      August 20, 2004, Markley and Bridge entered into a Client Service Agreement

      (“Agreement”). Under the Agreement, Markley, as Bridge’s client, indicated its

      desire that Bridge provide “services as may be necessary to meet [Markley’s]

      staffing needs” (App. Vol. 2 at 142), and Bridge agreed to:

              1. Provide [Markley] the employees and services as requested by
              [Markley] or [Markley’s] assigned representatives.

              2. Assume full responsibility for paying, withholding, and
              transmitting payroll taxes; making unemployment contributions;
              and handling unemployment and workers’ compensation claims
              involving assigned employees with respect to compensation that
              [Bridge] has agreed to pay.

              3. Recruit, interview, test, screen, and ensure compliance with
              legally required pre-employment obligations for all employees to
              be assigned to [Markley’s] facilities.

              ***

              5. Provide all services which [Bridge] shall render under this
              Agreement to be as an independent contractor with respect to
              [Markley].

      Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018       Page 3 of 13
              6. Provide workers’ compensation insurance coverage for all
              employees assigned to [Markley’s] facilities . . . .

      (App. Vol. 2 at 142). The Agreement further provided as follows:

              1. That [Bridge] will invoice [Markley] for services provided in
              accordance with this [A]greement on a weekly basis. . . .

              ***

              4. [Markley] agrees not to directly or indirectly hire an employee
              assigned through [Bridge] without written consent from [Bridge].
              ...

      (App. Vol. 2 at 143).

[4]   Walls began her employment with Bridge on June 23, 2014. Shortly thereafter,

      Bridge assigned her to work at Markley’s Elkhart assembly plant. On October

      2, 2014, while operating a punch press at Markley, Walls was pulled into the

      press, and a finger on her right hand was crushed and severed, resulting in

      permanent partial impairment. Walls filed a worker’s compensation claim with

      Bridge and its worker’s compensation insurer, and the insurer paid for all

      medical expenses and worker’s compensation benefits related to the incident.

      Markley did not pay any worker’s compensation benefits.

[5]   On May 12, 2016, Walls filed a complaint against Markley, alleging that “[a]s a

      direct and proximate result of Markley’s negligence,” she sustained “personal

      injuries requiring surgeries and long-term medical care and mental distress and

      Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018       Page 4 of 13
      emotional injuries.” (App. Vol. 2 at 17). On July 5, 2016, Markley filed its

      answer to the complaint.

[6]   On October 13, 2017, Markley filed a motion for summary judgment,

      maintaining that Walls was a joint employee of Bridge and Markley; that under

      the Act, Walls’ exclusive remedy for personal injury was through worker’s

      compensation; and that the trial court, therefore, lacked subject matter

      jurisdiction over the action. Walls filed a response to the summary judgment

      motion on November 10, 2017. On December 29, 2017, the trial court held

      oral argument on the motion.

[7]   On January 18, 2018, the trial court issued its order, indicating that it treated

      Markley’s motion for summary judgment as a motion to dismiss for lack of

      subject matter jurisdiction under Trial Rule 12(B)(1). The trial court granted
                                                                                                                 2
      Markley’s motion and dismissed Walls’ negligence action. Walls now appeals.

                                                  Discussion
[8]   Walls argues that the trial court erred when it dismissed her complaint against

      Markley under Trial Rule 12(B)(1) for lack of subject matter jurisdiction,

      finding that the Act was her exclusive remedy for the personal injuries she

      sustained while working at Markley.

      2
        Walls has filed a motion to strike Markley’s appendix and any reference thereto in Markley’s brief. Walls
      also has filed a motion for leave to cite to an unpublished case. Contemporaneously with this memorandum
      decision, we grant Walls’ motion to strike Markley’s appendix but decline to strike portions of Markley’s
      brief. We hereby deny Walls’ motion for leave to cite to an unpublished case.

      Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018                            Page 5 of 13
[9]    It is well-settled that when an employer defends against an individual’s

       negligence claim on the basis that the individual’s exclusive remedy is to pursue

       a claim for benefits under the Act, the defense is properly advanced through a

       motion to dismiss for lack of subject matter jurisdiction under Trial Rule

       12(B)(1). GKN Co. v. Magness, 744 N.E.2d 397, 400 (Ind. 2001) (citing Foshee v.

       Shoney’s Inc., 637 N.E.2d 1277, 1280 (Ind. 1994)). “When a trial court is

       confronted with a motion to dismiss based on Ind. Trial Rule 12(B)(1), the trial

       court is required to determine whether it has the power to adjudicate the

       action.” MHC Surgical Ctr. Assocs., Inc. v. State Office of Medicaid Policy and

       Planning, 699 N.E.2d 306, 308 (Ind. Ct. App. 1998). “In ruling on a motion to

       dismiss for lack of subject matter jurisdiction, the trial court may consider not

       only the complaint and motion but also any affidavits or evidence submitted in

       support.” GKN, 744 N.E.2d at 400. “In addition, the trial court may weigh the

       evidence to determine the existence of the requisite jurisdictional facts.” Id.

[10]   The applicable standard of review for Trial Rule 12(B)(1) motions to dismiss for

       lack of subject matter jurisdiction is a function of what occurred in the trial

       court. Id. at 401. That is, the standard of review is dependent upon: (i)

       whether the trial court resolved disputed facts; and (ii) if the trial court resolved

       disputed facts, whether it conducted an evidentiary hearing or ruled on a paper

       record. Id. If the facts before the trial court are not in dispute, then the

       question of subject matter jurisdiction is purely one of law. Id. Under those

       circumstances no deference is afforded the trial court’s conclusion because

       appellate courts independently, and without the slightest deference to the trial

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018           Page 6 of 13
       court determinations, evaluate those issues they deem to be questions of

       law. Id.

[11]   If, however, the parties dispute the facts presented to the trial court, then our

       standard of review focuses on whether the trial court conducted an evidentiary

       hearing. Id. Under those circumstances, the court engages in its fact-finding

       function, often evaluating the character and credibility of witnesses. Id.

       Accordingly, when a trial court conducts an evidentiary hearing, we give

       deference to its factual findings and judgment, and we will reverse only if the

       findings and judgment are clearly erroneous. Id.

[12]   However, where, as here, the facts are in dispute but the trial court rules on a
                                                                              3
       paper record without conducting an evidentiary hearing, then no deference is

       afforded the trial court’s factual findings or judgment. Under those

       circumstances, a court of review is “in as good a position as the trial court to

       determine whether the court has subject matter jurisdiction.” Id. Thus, we

       review de novo a trial court’s ruling on a motion to dismiss where the facts

       before the court are disputed and the trial court rules on a paper record. Id. In

       so doing, we will affirm the judgment of the trial court on any legal theory the

       evidence of record supports. Id. However, the ruling of the trial court is

       presumptively correct, and we will reverse on the basis of an incorrect factual

       3
           Here, the trial court held oral argument on Markley’s motion.

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018       Page 7 of 13
       finding only if the appellant persuades us that the balance of the evidence is

       tipped against the trial court’s findings. Id.

[13]   Turning to the facts of this case, we note that the Act provides the exclusive

       remedy for recovery of personal injuries arising out of and in the course of

       employment. IND. CODE § 22-3-2-6 (“The rights and remedies granted to an

       employee [under the Act] on account of personal injury or death by accident

       shall exclude all other rights and remedies of such employee . . . on account of

       such injury or death, except for remedies available under IC 5-2-6.1.”).

       Although the Act bars a court from hearing any common law claim brought

       against an employer for an on-the-job injury, it does permit an action for injury

       against a third-party tortfeasor provided the third-party is neither the plaintiff’s

       employer nor a fellow employee. I.C. § 22-3-2-13.

[14]   INDIANA CODE § 22-3-6-1(a) defines “employer” for purposes of the Act as

       follows, in relevant part: “‘Employer’ includes the state and any political

       subdivision, any municipal corporation within the state, any individual or the

       legal representative of a deceased individual, firm, association, limited liability

       company, or corporation or the receiver or trustee of the same, using the

       services of another for pay.” The statute further provides, “Both a lessor and a

       lessee of employees shall each be considered joint employers of the employees provided by

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018            Page 8 of 13
                                                                                       4
       the lessor to the lessee for purposes of IC 22-3-2-6 and IC 22-3-3-31.” I.C. § 22-3-6-1(a)

       (emphasis added).

[15]   According to Walls, the trial court erred in finding that she was a joint

       employee of both Bridge and Markley. Walls specifically contends that she is

       entitled to recover against Markley because at the time she was injured, she was

       not a leased employee of Markley but, instead, was “the employee of an

       independent contractor – Bridge – who assigned her not to Markley but to work

       at Markley’s facility.” (Walls’ Br. 12) (emphasis added). The focus of Walls’

       argument is that “an assigned employee is not the same as a leased employee if

       those terms are strictly construed.” (Walls’ Br. 14). According to Walls, “[a]n

       assignment, contrary to a lease, does not necessarily involve a relinquishment of

       control of the property or person assigned.” (Walls’ Br. 14). Thus, according to

       Walls, because Walls was assigned to work at Markley’s assembly plant, Walls was

       not a Markley employee. To resolve this matter, and because the Act does not

       define when an employee is considered “leased” under INDIANA CODE § 22-3-

       2-6(1)(a), Walls invites this Court to interpret the statute to “‘determine and

       4
         INDIANA CODE § 22-3-2-6 is the exclusive remedy provision of the Act. INDIANA CODE § 22-3-3-31 requires
       joint employers to contribute to the payment of compensation for injuries or death in proportion to their
       wage liability. This section also provides “that nothing in this section shall prevent any reasonable
       arrangements between such employers for a different distribution as between themselves of the ultimate
       burden of compensation.” I.C. § 22-3-3-31. The Agreement between Markley and Bridge stated that Bridge
       assumed full responsibility for handling worker’s compensation claims involving assigned employees and
       would provide worker’s compensation insurance coverage for all employees assigned to Markley’s facility.

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018                         Page 9 of 13
       give effect to the intent of the legislature’” regarding the term “leased.” (Walls’

       Br. 13).

[16]   It is well-settled that we cannot and do not engage in statutory interpretation

       unless the language of the statute is ambiguous. Hinshaw v. Bd. of Comm’rs of Jay

       County, 611 N.E.2d 637, 638 (Ind. 1993). An ambiguous statute is one which is

       susceptible to more than one interpretation. Id. When a statute is ambiguous,

       we will engage in construction to effect the intent of the legislature. Id.

       However, if the statute is not ambiguous, we must give effect to the plain,

       ordinary, and usual meaning of the words of the statute. State Bd. of Tax

       Comm’rs v. Jewell Grain Co., Inc., 556 N.E.2d 920, 921 (Ind. 1990).

[17]   Here, our review does not reveal any ambiguity regarding INDIANA CODE § 22-

       3-2-6(1)(a). Thus, we decline to engage in statutory interpretation of the statute.

       However, we do note that the term “leased” is not defined in the Act.

       Undefined words in a statute or ordinance are given their plain, ordinary, and

       usual meaning. 600 Land, Inc. v. Metro. Bd. of Zoning Appeals of Marion Cty., 889
N.E.2d 305, 309 (Ind. 2008); IND. CODE § 1-1-4-1(1). As a result, courts may

       consult English language dictionaries to ascertain the plain and ordinary

       meaning of a statutory term. State Bd. of Accounts v. Ind. Univ. Found., 647
N.E.2d 342, 347 (Ind. Ct. App. 1995), trans. denied.

[18]   The term “leased” is defined as “1. To grant use or occupation of under the

       terms of a contract. 2. To get or hold by such a contract.” American Heritage

       Dictionary of the English Language Online (5th ed. 2018)

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018      Page 10 of 13
       https://www.ahdictionary.com/word/search.html?q=lease (last visited Nov.

       19, 2018). Black’s Law Dictionary defines the term “lease,” as a verb, as

       follows: “[t]o grant the possession and use of (land, buildings, rooms, movable

       property, etc.) to another in return for rent or other consideration.” Lease,

       Black’s Law Dictionary (8th ed. 2004).

[19]   The term “assign” is defined as “6. Law To transfer (property, rights, or

       interests) from one to another.” American Heritage Dictionary of the English

       Language Online https://www.ahdictionary.com/word/search.html?q=assign

       (last visited Nov. 19, 2018). Black’s Law Dictionary defines the term “assign”

       as “[t]o convey; to transfer rights or property . . . .” Assign, Black’s Law

       Dictionary (8th ed. 2004).

[20]   In its order granting Markley’s motion to dismiss, the trial court found as

       follows:

               Walls’ differentiation between “leased” and “assigned”
               employees – the latter being a category she argues that she falls
               into and that rules out any finding of dual employment under §
               22·3·6·l(a) – is a distinction that is illusory rather than real. . . .
               Walls makes much of the Bridge-Markley [A]greement’s liberal
               use of the word “assign” and its derivatives, claiming that this
               aspect of the agreement weighs against a conclusion that she is a
               “leased” employee of Markley’s under § 22·3·6·l(a). This
               contention attributes unwarranted significance to the use of
               “assign.” Use of that word simply acknowledges what staffing
               agencies like Elwood and Bridge do: they “assign” workers to
               client companies seeking their assistance in obtaining an
               adequate workforce. See, e.g., Frontz v. Middletown Enter., Inc., 15
N.E.3d 666, 667 (Ind. Ct. App. 2014) (holding that plaintiff

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018          Page 11 of 13
                Frontz was limited to remedies under Worker’s Compensation
                Act against Middletown after he was injured; “Frontz was an
                employee of Wimmer Temporaries, Inc.” and “Wimmer assigned
                Frontz to Middletown”) (emphasis added); Taylor v. Ford Motor
                Co., 944 N.E.2d 78, 83 (Ind. Ct. App. 2011) (describing plaintiff
                in [Kenwal Steel Corp. v. Seyring, 903 N.E.2d 510 (Ind. Ct. App.
                2009),] as a “temporary employee [who] sought to bring suit
                against the company he had been assigned to work for”)
                (emphasis added). It does not transform the arrangement
                between Bridge and Markley as to Walls into something other
                than what it was as a matter of law: an arrangement by one
                company (Markley) to lease an employee (Walls) from a
                temporary staffing agency (Bridge).

       (App. Vol. 2 at 12-14). We agree. For purposes of the Act, Bridge was the

       lessor of Walls, Markley was the lessee of Walls, and Walls was a joint

       employee of the two. Accordingly, Walls is limited to the exclusive remedy

       provision of the Act. The trial court did not err in dismissing her action against
                                                                      5
       Markley for lack of subject matter jurisdiction.

[21]   Walls also argues that, under the terms of the Agreement between Bridge and

       Markley, Markley “opted out” of the exclusive remedy provision of the Act.

       (Walls’ Br. 18). In support of her argument, Walls points to the following terms

       of the Agreement: [Bridge] “agrees to . . . “[p]rovide workers’ compensation

       insurance coverage for all employees assigned to [Markley’s] facilities” and

       5
        Because of this holding, we need not analyze the employment relationship between Markley and Walls
       under the seven-factor test set forth in Hale v. Kemp, 579 N.E.2d 63 (Ind. 1991). See also GKN, 744 N.E.2d at
       399.

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018                            Page 12 of 13
       “[a]ssume full responsibility for . . . workers’ compensation claims involving

       assigned employees.” (App. Vol. 2 at 142). According to Walls, the

       “arrangement clearly intended that [Walls] would remain a Bridge employee –

       and only a Bridge employee – while rendering services at Markley’s plant[, and

       that] Markley opted out of worker’s compensation rights and responsibilities.”

       (Walls’ Br. 22).

[22]   Even assuming that an employer can waive the exclusive remedy provision of

       the Act, Walls has not established that Markley waived its rights or “opted out

       of worker’s compensation rights and responsibilities.” (Walls’ Br. 22).

       “Waiver is the intentional relinquishment of a known right; an election by one

       to forego some advantage he might have insisted upon.” Lafayette Car Wash,

       Inc. v. Boes, 258 Ind. 498, 501, 282 N.E.2d 837, 839 (1972). Nothing in the

       terms of the Agreement suggests that Markley intentionally relinquished its

       right. We, therefore, conclude that Markley did not waive its right to enforce

       the exclusive remedy provision of the Act, and that the trial court did not err in

       finding the same.

[23]   Affirmed.

       Vaidik, C.J., and Barnes, Sr.J., concur.

       Court of Appeals of Indiana | Opinion 18A-CT-266 | December 11, 2018     Page 13 of 13