Haulcy v. The Goodyear Tire & Rubber Co.

Workers' Compensation, law of the case doctrine, disability determination

LASHANDA SHAW, Plaintiff v. THE GOODYEAR TIRE & RUBBER CO., Defendants No. COA12-338 Filed 15 January 2013 Jurisdiction — subject matter — negligent infliction of emotional distress — Workers’ Compensation Act — exclusivity provisions The trial court lacked subject matter jurisdiction over plaintiff’s negligent infliction of emotional distress claim caused by defendant’s willful or wanton negligence because the exclusivity provision of the Workers’ Compensation Act gives the Industrial Commission exclusive jurisdiction over this type of claim. Plaintiff’s claim fell within the purview of the Worker’s Compensation Act but was not enough to sustain a Woodson claim and thereby qualify as an exception to the exclusivity provisions of the Workers’ Compensation Act. Appeal by defendant from judgment entered 8 April 2011 by Judge Mary Ann Tally in Superior Court, Cumberland County. Heard in the Court of Appeals 29 November 2012. Kennedy, Kennedy, Kennedy and Kennedy, LLP, by Harold L. Kennedy, III and Harvey L. Kennedy, for plaintiff-appellee. Brooks, Pierce, McLendon, Humphrey & Leonard, L.L.P, by Julia C. Ambrose, John W. Ormand, III and Patricia W. Goodson, for defendant-appellant. Womble Carlyle Sandridge & Rice, LLP, by Burley B. Mitchell, Jr., for Amicus Curiae North Carolina Chamber. STROUD, Judge. This case presents in a unique procedural posture, with defendant’s appeal from a $450,000,00 jury award to plaintiff for her claim of negligent infliction of emotional distress, arguing, inter alia, that the trial court lacked subject matter jurisdiction. For the following reasons, we agree and vacate the judgment of the trial court. I. Background This case is in an unusual procedural posture because it comes to us with facts that have already been determined by a jury. Because the only issue addressed by this Court is subject matter jurisdiction, we recite just the background we deem pertinent for an understanding of the jurisdictional issue before us. In 2007, defendant hired plaintiff “as an Area Manager.” During the course of plaintiff’s employment, she complained that she was being harassed by her male supervisor. Plaintiff’s supervisor’s behavior toward plaintiff was obnoxious and rude; the harassment was verbal and involved some forms of intimidation but did not involve anything of a sexual nature nor did it involve any physical contact with plaintiff. Despite plaintiff’s complaints to the appropriate personnel, plaintiff’s supervisor remained in his position, where he continued to harass her, and eventually, defendant terminated plaintiff’s employment. On 13 January 2010, plaintiff filed a verified amended complaint claiming (1) wrongful discharge, (2) violation of Retaliatory Employment Discrimination Act (“REDA”), (3) tortious interference with contractual rights, (4) intentional infliction of emotional distress, and (5) negligent infliction of emotional distress (“NIED”). On or about 27 August 2010, plaintiff voluntarily dismissed her second claim, the REDA claim. On 8 November 2010, defendant filed a motion for summary judgment. On 21 December 2010, the trial court filed an order regarding defendant’s motion for summary judgment and dismissed plaintiff’s third and fourth claims for tortious interference with contractual rights and intentional infliction of emotional distress. Accordingly, only plaintiff’s first and fifth claims for wrongful discharge and NIED remained at the time of trial. The allegations central to both plaintiff’s wrongful discharge and NIED claims were that plaintiff complained to defendant about the harassment by her supervisor; defendant negligently handled plaintiff’s complaint about the harassment; and defendant’s negligence caused plaintiff’s emotional distress and eventually led to her wrongful discharge. Several specific issues were submitted to the jury, and on appeal neither party challenges these issues as submitted to the jury. After a lengthy trial, the jury entered the following verdict: ISSUE ONE: Did the defendant intentionally discriminate against the plaintiff because of her race or sex or both when the defendant fired the plaintiff? [The jury answered “No[.]”] ISSUE TWO: Did the defendant retaliate against the plaintiff by firing her for her making a complaint of discrimination based upon her race or sex or both? [The jury answered “Yes[.]”] ISSUE THREE: Would the defendant have terminated the plaintiff in the absence of race or sex discrimination and/or retaliation for her complaints of discrimination? YOU WILL ANSWER THIS ISSUE ONLY IF YOU HAVE ANSWERED ISSUES 1 OR 2 “YES[”] IN FAVOR OF THE PLAINTIFF. [The jury answered “Yes[.]”] ISSUE FOUR: Did the plaintiff suffer severe emotional distress as a proximate result of the negligence of the defendant? [The jury answered “Yes[.]”] ISSUE FIVE: What amount of damages is the plaintiff entitled to recover? YOU ARE TO ANSWER THIS ISSUE ONLY IF YOU HAVE ANSWERED ISSUES 1 OR 2 “YES” IN FAVOR OF PLAINTIFF AND ANSWERED ISSUE 3 “NO” OR IF YOU HAVE ANSWERED ISSUE 4 IN FAVOR OF THE PLAINTIFF. [The jury answered “$450,000.00[.]”] The jury verdict sheet required that the jury answer Issue Five only in either of two scenarios: (1) “IF [IT HAD] ANSWERED ISSUES 1 OR 2 ‘YES’ IN FAVOR OF PLAINTIFF AND ANSWERED ISSUE 3 ‘NO’ ” or (2) “IF [IT HAD] ANSWERED ISSUE 4 IN FAVOR OF THE PLAINTIFF.” The jury answered Issue Two “Yes[,]” but answered Issue Three “No[.]” Accordingly, the jury could not award plaintiff a verdict based upon the first two issues. The jury answered Issue Four “Yes[,]” and thus the award of $450,000.00 was based solely upon Issue Four regarding plaintiff’s “severe emotional distress as a proximate result of the negligence of defendant.” In summary, the jury did not award plaintiff any damages for her wrongful discharge claim but only for her NIED claim. The jury then considered the issue of punitive damages. The jury entered the following verdict as to punitive damages: ISSUE ONE: IS THE DFENDANT LIABLE TO THE PLAINTIFF FOR PUNITIVE DAMAGES FOR NEGLIGENT INFLICTION OF SEVERE EMOTIONAL DISTRESS? [The jury answered “Yes[.]”] ISSUE TWO: WHAT AMOUNT OF PUNITIVE DAMAGES, IF ANY, DOES THE JURY IN ITS DISCRETION AWARD TO THE PLAINTIFF? (YOU ARE TO ANSWER THIS ISSUE ONLY IF YOU HAVE ANSWERED THE FIRST “YES” IN FAVOR OF THE PLAINTIFF) [The jury answered “None[.]”[ On 8 April 2011, the trial court entered judgment consistent with the jury’s verdict sheets and awarded plaintiff compensatory damages of $450,000.00. Defendant appeals. II. Jurisdiction Defendant argues that “the trial court lacked subject matter jurisdiction over plaintiff’s NIED claim, which is barred by the exclusivity provision of the Workers’ Compensation Act.” (Original in all caps.) “Whether a trial court has subject-matter jurisdiction is a question of law, reviewed de novo on appeal.” McKoy v. McKoy, 202 N.C. App. 509, 511, 689 S.E.2d 590, 592 (2010). It is important to note that the only issue on appeal is the trial court’s jurisdiction as to plaintiff’s NIED claim, and thus we need not consider any of plaintiff’s other claims. Furthermore, the relevant facts have already been determined by the jury, so our analysis is based upon the jury’s verdict and not the allegations or evidence of either party. Here, the jury determined that “plaintiff suffered] severe emotional distress as a proximate result of the negligence of the defendant” and awarded plaintiff $450,000.00 as compensation for that claim and that claim only. The jury further determined that defendant is “liable to the plaintiff for punitive damages for negligent infliction of severe emotional distress” but awarded no damages. (Original in all caps.) However, a finding of liability for punitive damages requires that the plaintiff prove “that the defendant is liable for compensatory damages and that one of the following aggravating factors was present and was related to the injury for which compensatory damages were awarded: (1) Fraud. (2) Malice. (3) Willful or wanton conduct.” N.C. Gen. Stat. § 1D-I5(a) (2007). The jury was properly instructed on the requirements for a finding of liability for punitive damages as to willful or wanton conduct. Plaintiff proved “that the defendant [was] liable for compensatory damages” as is shown by the jury’s compensatory damages award of $450,000.00. Accordingly, the issue before us is whether the trial court had jurisdiction over plaintiff’s claim for NEID caused by defendant’s willful or wanton negligence. A. Willful and/or Wanton Negligence Defined Here, the jury has already made the determination that defendant’s negligence was “willful or wanton.” “Willful negligence arises from the tortfeasor’s deliberate breach of a legal duty owed to another, while wanton negligence is done of a wicked purpose or done needlessly, manifesting a reckless indifference to the rights of others.” Sloan v. Miller Building Corp., 128 N.C. App. 37, 43, 493 S.E.2d 460, 464 (1997) (citation, quotation marks, and ellipses omitted). “Wil[l]ful and wanton negligence is conduct which shows either a deliberate intention to harm, or an utter indifference to, or conscious disregard for, the rights or safety of others. Carelessness and recklessness, though more than ordinary negligence, is less than willful[l]ness or wantonness.” Siders v. Gibbs, 31 N.C. App. 481, 485, 229 S.E.2d 811, 814 (1976) (citation and quotation marks omitted). Here, defendant argues that the trial court did not have jurisdiction over plaintiff’s NIED claim caused by defendant’s willful and wanton negligence because the Industrial Commission has exclusive jurisdiction over this type of claim. B. The Exclusivity Provisions N.C. Gen. Stat. § 97-9 provides, Every ,employer subject to the compensation provisions of this Article shall secure the payment of compensation to his employees in the manner hereinafter provided; and while such security remains in force, he or those conducting his business shall only be liable to any employee for personal injury or death by accident to the extent and in the manner herein specified. N.C. Gen. Stat. § 97-9 (2007). N.C. Gen. Stat. § 97-10.1, provides, If the employee and the employer are subject to and have complied with the provisions of this Article, then the rights and remedies herein granted to the employee, his dependents, next of kin, or personal representative shall exclude all other rights and remedies of the employee, his dependents, next of kin, or representative as against the employer at common law or otherwise on account of such injury or death. N.C. Gen. Stat. § 97-10.1 (2007). Thus, this Court and our Supreme Court have agreed that [t]he [Workers’ Compensation] Act provides that its remedies are the only remedies an employee has against his or her employer for claims covered by the Act. . . . Even where the complaint alleges willful and wanton negligence and prays for punitive damages, the remedies under the Act are exclusive. An employee cannot elect to pursue an alternate avenue of recovery, but is required to proceed under the Act with respect to compensable injuries. McAllister v. Cone Mills Corp., 88 N.C. App. 577, 580, 364 S.E.2d 186, 188 (1988) (emphasis added) (citations omitted); see Freeman v. SCM Corporation, 311 N.C. 294, 295-96, 316 S.E.2d 81, 82 (1984) (The “plaintiff filed this action, alleging that her injuries were caused by the gross, willful and wanton negligence and by the intentional acts of defendant.... Since plaintiff was here covered by and subject to the provisions of the Workers’ Compensation Act, her rights and remedies against defendant employer were determined by the Act and she was required to pursue them in the North Carolina Industrial Commission. She could not, in lieu of this avenue of recovery, institute a common law action against her employer in the civil courts of this State.” (citation omitted)). Thus, the only ways in which plaintiff might avoid the exclusive jurisdiction of the Industrial Commission are (1) that her claim falls under an exception to the exclusivity provisions or (2) that her NIED claim was not “covered by the Act.” McAllister, 88 N.C. App. at 580, 364 S.E.2d at 188. We consider both of these alternatives in turn. C. Woodson v. Rowland In 1991, our Supreme Court recognized one exception to the exclusivity provisions with the seminal case of Woodson v. Rowland, 329 N.C. 330, 407 S.E.2d 222 (1991). In Woodson, Mr. Thomas Sprouse was working in a trench “to lay sewer lines.” 329 N.C. at 334, 407 S.E.2d at 225. The trench should have had a trench box, but did not in violation of the Occupational Safety and Health Act of North Carolina. Id. at 335, 407 S.E.2d at 225. One foreman did not allow his men to work in the trench because of the dangers posed by the trench without a trench box. Id. Though a trench box was available on site, Mr. Sprouse’s project supervisor, among others, decided not to use it; the trench collapsed and Mr. Sprouse was buried alive. Id. at 335-36, 407 S.E.2d at 225. Mr. Sprouse died as a result of the trench collapse and plaintiff, the administrator of Mr. Sprouse’s estate, sued at the trial court but also filed a Workers’ Compensation claim to meet the filing deadline for compensation claims. In order to avoid a judicial ruling that she had elected a workers’ compensation remedy inconsistent with the civil remedies she presently seeks, plaintiff specifically requested that the Industrial Commission not hear her case until completion of th[e] action [before the trial court]. The Commission . . . complied with her request[.] Id. at 336, 407 S.E.2d at 226. The defendant requested summary judgment and prevailed at both the trial level and before this Court. Id. Upon further appeal, the question pending before the Supreme Court was “whether the exclusivity provisions of the Workers’ Compensation Act limit[ed] plaintiff’s remedies to those provided by the Act.” Id. at 334, 407 S.E.2d at 224. The Court then engaged in a thorough analysis of statutory provisions, our case law, and the case law of other jurisdictions reasoning that [i]n Pleasant, which involved co-employee liability for recklessly operating a motor vehicle, we concluded that injury to another resulting from willful, wanton and reckless negligence should also be treated as an intentional injury for purposes of our Workers’ Compensation Act. The Pleasant Court expressly refused to consider whether the same rationale would apply to employer misconduct. Nonetheless, Pleasant equated willful, wanton and reckless misconduct with intentional injury for Workers’ Compensation purposes. The plaintiff in Barrino v. Radiator Specialty Co., 315 N.C. 500, 340 S.E.2d 295 (1986), urged us to extend the Pleasant rationale to injuries caused by an employer’s willful and wanton misconduct. The plaintiff, administrator of the estate of the deceased employee, alleged in part that the decedent died as a result of severe burns and other injuries caused by an explosion and fire in the. employer’s plant. On the employer’s motion for summary judgment, the plaintiff’s forecast of evidence, which included the allegations of the complaint, tended to show as follows: the employer utilized ignitable concentrations of flammable gasses and volatile flammable liquids at its plant, violated OSHANC regulations in the use of these substances, covered meters and turned off alarms designed to detect and warn of dangerous levels of explosive gasses and vapors — all of which resulted in the explosion and fire which caused the employee’s death. A majority of this Court in Barrino refused to extend the Pleasant rationale to employer conduct, but only two of the four majority justices expressed the view that the plaintiff’s injuries were solely by accident and that the remedies provided by the Act were exclusive. These two justices relied in part on Freeman v. SCM Corporation, 311 N.C. 294, 316 S.E.2d 81 (1984), a per curiam opinion which concluded that a complaint alleging injuries caused by the willful and wanton negligence of an employer should be dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) of the North Carolina Rules of Civil Procedure because exclusive jurisdiction rested under the Workers’ Compensation Act with the Industrial Commission. The other two justices in the Barrino majority concurred on the ground that the plaintiff, having accepted workers’ compensation benefits, was thereby barred from bringing a civil suit. The three remaining justices dissented on the ground that the plaintiff’s forecast of evidence was sufficient to raise a genuine issue of material fact as to whether the defendant-employer’s conduct embodies a degree of culpability beyond negligence so as to allow the plaintiff to maintain a civil action. Believing the plaintiff’s forecast of evidence was sufficient to survive summary judgment on the question of whether the employer was guilty of an intentional tort, the Barrino dissenters said: As Prosser states: Intent is broader than a desire to bring about physical results. It must extend not only to those consequences which are desired, but also to those which the actor believes are substantially certain to follow from what he does. The death of Lora Ann Barrino the employee was, at the very least, substantially certain to occur given defendants’ deliberate failure to observe even basic safety laws. As discussed in a subsequent portion of this opinion, the dissenters also concluded that the plaintiff was not put to an election of remedies. They thus would have allowed the plaintiff’s common law intentional tort claim to proceed to trial on the theory that the defendant intentionally engaged in conduct knowing it was substantially certain to cause serious injury or death. They would also have allowed the plaintiff to pursue both a workers’ compensation claim and a civil action. Today we adopt the views of the Barrino dissent. We hold that when an employer intentionally engages in misconduct knowing it is substantially certain to cause serious injury or death to employees and an employee is injured or killed by that misconduct, that employee, or the personal representative of the estate in case of death, may pursue a civil action against the employer. Such misconduct is tantamount to an intentional tort, and civil actions based thereon are not barred by the exclusivity provisions of the Act. Because, as also discussed in a subsequent portion of this opinion, the injury or death caused by such misconduct is nonetheless the result of an accident under the Act, workers’ compensation claims may also be pursued. There may, however, only be one recovery. We believe this holding conforms with general legal principles and is true to the legislative intent when considered in light of the Act’s underlying purposes. Id. at 339-41, 407 S.E.2d at 227-28 (emphasis added) (citations, quotation marks, ellipses, and brackets omitted). The Court further explained, Our holding is consistent with general concepts of tort liability outside the workers’ compensation context. The gradations of tortious conduct can best be understood as a continuum. The most aggravated conduct is where the actor actually intends the probable consequences of his conduct. One who intentionally engages in conduct knowing that particular results are substantially certain to follow also intends the results for purposes of tort liability. Intent is broader than a desire to bring about physical results. It extends not only to those consequences which are desired, but also to those which the actor believes are substantially certain to follow from what the actor does. This is the doctrine of constructive intent. As the probability that a certain consequence will follow decreases, and becomes less than substantially certain, the actor’s conduct loses the character of intent, and becomes mere recklessness. As the probability decreases further, and amounts only to a risk that the resul