Morgan v. Gaylord Container Corp. ( 1994 )

UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 93-3573
JACQUELINE MORGAN, ET AL.,
Plaintiff-Appellant,
VERSUS
GAYLORD CONTAINER CORP., ET AL.,
Defendants-Appellees.
Appeal from the United States District Court
for the Eastern District of Louisiana
(August 16, 1994)
Before REYNALDO G. GARZA and DeMOSS, Circuit Judges, and PARKER,
District Judge.1
DeMOSS, Circuit Judge:
BACKGROUND
Jacqueline Morgan was an employee of Thomas Industrial
Corporation ("TIC"), a subcontractor on a modification and
expansion project at the Gaylord Container Corporation's ("GCC")
paper mill in Bogalusa, Louisiana. GCC hired TIC to effect
1
Judge Parker participated by designation in the oral argument
of this case as a United States District Judge for the Eastern
District of Texas. Since that time he has been appointed as a
Fifth Circuit Judge.
improvements to the duct system of GCC's wastepaper recovery
system. At the time of the alleged accident, Morgan was engaged in
work undertaken by TIC in its contract with GCC. Specifically,
Morgan was operating a high pressure hose and washing out an area
of the mill when she allegedly slipped and fell.
Morgan filed suit against GCC and Goulds Pumps, Inc., the
manufacturer of pumps which allegedly leaked water on to the
flooring surface of the area Morgan was washing out. Morgan
alleged that GCC, as premise owner, was responsible in tort for her
injuries. She also alleged theories of products liability against
Goulds for designing the pump in such a manner as to allow water to
leak on to the floor of the mill and for failing to provide an
adequate warning concerning the hazards occasioned by the pump's
design.
Both defendants moved for summary judgment. GCC asserted that
Morgan was its statutory employee under Louisiana's worker's
compensation laws and, therefore, that it was immune from tort
liability. Goulds claimed, inter alia, that as a matter of law,
its pumps were not defectively designed and that it had no duty to
warn Morgan of a condition which was open and obvious. The
district court granted both defendants' motions, and Morgan now
appeals.
DISCUSSION
1. GCC's Judgment
As pointed out by the district court,"[t]his case does not
present a factual dispute; the parties only dispute the legal
2
conclusion [to be] draw[n] from the undisputed facts." The
district court concluded that GCC was Morgan's statutory employer.
Morgan disputes both this conclusion and the legal analysis
employed to reach it. Review of Louisiana's statutory employer
doctrine is warranted.
Like other such systems, Louisiana's worker's compensation
system immunizes employers from tort liability for injuries their
employees suffer for which the employees would be entitled to
worker's compensation benefits. LA. REV. STAT. ANN. § 23:1032 (West
1985). Louisiana extends this immunity to persons who contract
with others to perform work which is a part of the person's "trade,
business, or occupation." Id. In such a circumstance, the person
becomes the worker's "principal," or a statutory employer.2 LA. REV.
STAT. ANN. § 23:1061 (West Supp. 1994). Thus, a principal is
immunized from tort liability if the contract work being performed
was a part of the principal's trade, business, or occupation.
The Louisiana Supreme Court in Berry v. Holston Well Service,
Incorporated articulated a detailed, three level analysis for
determining whether contract work was part of a principal's trade,
business or occupation.3 See 488 So. 2d 934, 937-38 (La. 1986).
2
"Principal" is defined as "any person who undertakes to
execute any work which is a part of his trade, business or
occupation in which he was engaged at the time of the injury, or
which he contracted to perform and contracts with any person for
the execution thereof." LA. REV. STAT. ANN. § 23:1032.
3
Berry states that the first level of analysis focuses on "the
scope of the contract work." The "central question" under this
level is "whether the work is specialized or non-specialized." If
specialized, then the work is not a part of the principal's trade,
business, or occupation. If it is non-specialized, the second
3
The Berry test represented a very restrictive application of the
statutory employer doctrine and a rejection of the previously
employed "integral relation" test. Harris v. Murphy Oil, U.S.A.,
Inc., 980 F.2d 991, 993 (5th Cir. 1992).
However, in 1989, the Louisiana Legislature amended the
worker's compensation statute.4 See LA. REV. STAT. ANN. § 23:1061
(West Supp. 1994). The amendment has been interpreted as a
repudiation of the Berry test and the factors applied therein. See
Salsbury v. Hood Industries, Inc., 982 F.2d 912 915 (5th Cir.
1993). The amendment also heralded a reinstatement of the
previously rejected integral relation test. Id., at 916. Thus, to
determine whether a contractor's work is a part of the principal's
trade, business, or occupation, we apply the integral relation test
and ask whether the contract work being performed is integral or
essential to the principal's trade, business, or occupation. Deal
v. International Paper Company, 632 So. 2d 870, 871 (La. App. 2d
level of analysis is employed to compare the contract work with the
principal's trade, business, or occupation. This level involved
three independent inquiries: (1) whether the work was routine or
customary, (2) whether the principal had the equipment and
personnel to perform the work, and (3) what was the practice of the
industry. The final level of analysis inquired whether the
principal was engaged in the work at the time of the injury. 488
So. 2d at 937-39.
4
The Legislature added the following language to § 23:1061:
The fact that work is specialized or nonspecialized, is
extraordinary construction or simple maintenance, is work
that is usually done by contract or by the principal's
direct employee, or is routine or unpredictable, shall
not prevent the work undertaken by the principal from
being considered part of the principal's trade, business,
or occupation, regardless of whether the principal has
the equipment or manpower capable of performing the work.
4
Cir. 1994).
Morgan contends that the Berry factors are still relevant for
determining whether the integral relation test has been met. She
argues that "[t]he factors enumerated in Berry were present at the
very birth of the integral relation test[,]" and thus, that any
application of the integral relation test necessarily entails
consideration of the Berry factors. She suggests that the change
occasioned by the amendment to LA. REV. STAT. ANN. § 23:1061 does not
preclude consideration of the Berry factors, but that amendment no
longer makes the factors determinative.
Morgan's argument has been specifically rejected by both this
court and Louisiana intermediate appellate courts. Thompson v.
Georgia Pacific Corp., 993 F.2d 1166, 1168-69 (5th Cir. 1993);
Becker v. Chevron Chemical Co., 983 F.2d 44, 46 (5th Cir. 1993);
Salsbury, 982 F.2d at 915-916; Picard v. Zeit Exploration Co., ---
So.2d ---, 1994 WL 86167, *4 (La. App. 1st Cir. Mar. 11, 1994);
Moore v. Crystal Oil Company, 626 So. 2d 792, 796 (La. App. 2d Cir.
1993). We decline, therefore, Morgan's invitation to consider or
apply any of the Berry factors.
Rejection of Morgan's proposed analysis results in rejection
of her proposed conclusion. Her argument against the existence of
a statutory employer relationship relies on several, if not all, of
the Berry factors. Moreover, her argument that GCC was engaged in
extraordinary construction beyond the scope of its trade, business,
5
or occupation is unavailing. Becker, 983 F.2d at 46 ("[t]he fact
that this work might be considered extraordinary construction work
. . . is irrelevant under the amended version of 23:1061[]"); see
also Thompson, 993 F.2d at 1169.
As the undisputed facts reveal, GCC embarked on a project to
expand the wastepaper handling capacity of the Bogalusa paper mill.
The project was necessary to increase the wastepaper capacity of
the paper mill from 100 tons per day to 100,000 tons per day and
allowed GCC to increase the overall productivity of the plant. The
specific project to which Morgan was assigned was the "Number 8
Paper Machine Project." This project called for the demolition of
a smaller paper machine and the installation of a new, larger
machine, including a building and all supporting equipment. At the
time of the accident, Morgan was preparing a flooring surface for
the installation of a concrete base on which a pump was to be
installed. The pump and its supporting structures were an integral
part of the Number 8 Paper Machine Project. We hold, therefore,
that the contract work performed by TIC, and specifically by
Morgan, was an integral part of GCC's trade, business, and
occupation within the meaning of LA. REV. STAT. ANN. § 23:1032.
We affirm the district court's entry of summary judgment in
favor of GCC.
2. Goulds's Judgment
As stated above, Morgan sought damages from Goulds under
products liability theories of defective design and inadequate
warning. For the reasons discussed below, the district court
6
entered judgment for Goulds on both claims and denied Morgan's
motion for reconsideration. Finding ourselves in agreement with
the court's reasoning and conclusions, we affirm entry of summary
judgment for Goulds.
a. Defective Design Claim
In order for Morgan to recover from Goulds on her defective
design claim, she would have to prove that
. . . at the time the product left its manufacturer's
control:
(1) There existed an alternative design for the product
that was capable of preventing the claimant's damages;
and
(2) The likelihood that the product's design would cause
the claimant's damage and the gravity of that damage
outweighed the burden on the manufacturer of adopting
such alternative design and the adverse effect, if any,
of such alternative design on the utility of the product.
LA. REV. STAT. ANN. § 9:2800.56 (West 1991).
To withstand Goulds's motion for summary judgement, Morgan was
required to present evidence sufficient to enable a reasonable
trier of fact to conclude that she had established the essential
elements of her claim, including that safer alternative designs
were in existence at the time the pump left Goulds's control and
that the risk avoided by such designs outweighed the burden of
adopting the designs. Lavespere v. Niagara Mach. & Tool Works,
Inc., 910 F.2d 167, 181 & 183 (5th Cir. 1990). The district court
held that Morgan's proof failed on both accounts, and we agree.
Morgan tendered the expert opinions of Dr. Samuel J. Brown in
support of her claim. Dr. Brown opined concerning the defects
associated with the design of Goulds's pump and concerning several
7
allegedly safer design alternatives. However, as the district
court twice made clear to Morgan, wholly absent from Dr. Brown's
report is any assertion that the suggested design alternatives were
in existence at the time the pump left Goulds's control. Moreover,
Dr. Brown failed to offer any opinion concerning the effect, if
any, of his suggested design alternatives on the utility of the
pump. Absent such proof, Morgan's defective design claim did not
deserve to go any further. Id. at 183-84.
Apparently acknowledging the failure of proof on these
elements, Morgan takes the position that Dr. Brown's design
modifications are "obvious[ly]" inexpensive and easily
implemented.5 She relies on language from the Lavespere decision
noting that
there may be cases in which the judge or the jury, by
relying on background knowledge and 'common sense,' can
'fill in the gaps' in the plaintiff's case, estimate the
extent of the risk avoided, the costs of implementing the
proposed design change, or the adverse effects of the
design modification on the utility of the machine.
910 F.2d at 184 (footnote omitted). While we agree that such
cases may arise, we conclude that this is not such a case.
The pumps at issue here are operated by an electric motor. A
shaft runs from the motor to the impeller of the pump. The
impeller is the device which causes the mixture of water and pulp
to flow through pipes to various screens and filters. Where the
shaft passes through the pump housing, it is sealed by a "stuffing
5
We note that Morgan does not press this argument in relation
to whether any of Dr. Brown's design alternatives were in existence
at the time the pump left Goulds's control.
8
box." The shaft inside this stuffing box rotates at high speed and
generates heat. As a result, it must be cooled and lubricated.
Water is used to cool and lubricate the stuffing box area and to
keep grit and debris from the water and pulp mixture from damaging
the shaft and seals. The cooling water in the stuffing box is
allowed to flow into a steel base below the pump known as a "drip
lip style base." The base is drained by a 3/4" opening in its
bottom. Morgan alleges that this opening is too small and
frequently clogs, thus causing water to overflow the base and on to
the floor.
Dr. Brown's proposed modifications to this cooling system
leave unanswered questions of engineering and design that are of
sufficient complexity to be beyond the expertise of the average
judge and juror. We reject, therefore, Morgan's suggestion that
common sense makes obvious the relative ease and inexpense of
effecting Dr. Brown's modifications.
We affirm the district court's judgment vis á vis Morgan's
defective design claim.
b. Failure to Warn Claim
The district court held that Goulds had no duty to provide
Morgan adequate warning concerning the pumps based on LA. REV. STAT.
ANN. § 9:2800.57(B)(2), which provides:
B. A manufacturer is not required to provide an adequate
warning about his product when:
. . .
(2) The user or handler of the product already knows or
reasonably should be expected to know of the
characteristic of the product that may cause damage and
9
the danger of such characteristic.
The court concluded that GCC was the "user or handler" of the
Goulds pump, that GCC was aware of the small drain opening, and
that GCC was aware that water flowed on to the floor of the mill.
The court concluded, therefore, that Goulds was not required to
provide GCC a warning. Since the court had already determined that
Morgan was GCC's statutory employee, the court held further that
Goulds was not required to warn Morgan. See Davis v. Avondale
Indust., Inc., 975 F.2d 169, 173 (5th Cir. 1992) ("the seller is
likewise discharged of the duty to warn the employee if the seller
has no duty to warn the employer because of the latter's
sophistication").
Morgan argues that "Goulds had an affirmative duty to warn GCC
of the potential hazards associated with that leakage as well as
how that hazard could be avoided."6 Morgan concedes, however, that
"[GCC] knew that the drain holes would clog and that the pumps
leaked water." She also acknowledges that "GCC attempted
unsuccessfully to keep the water from flowing onto the floor." Her
position is that GCC "apparently did not know how to solve this
problem[,]" and that Goulds had the duty "to inform [GCC] of the
effective means of how to control the leakage of water onto the
floor . . . and/or how to minimize the dangerous effects."
It is clear that GCC was fully aware of "the characteristic of
6
We note that Morgan does not challenge the district court's
reasoning that Goulds's duty to warn Morgan was contingent upon the
existence of a duty to warn GCC. Morgan's sole argument on appeal
concerns Goulds's alleged duty to provide GCC with an adequate
warning.
10
the product that [allegedly] cause[d] damage," i.e., the clogging
of the drain hole, and of "the danger of such characteristic,"
i.e., that water would leak on to the floor. See LA. REV. STAT. ANN.
§ 9:2800.57(B). Thus, Goulds was not required to provide GCC an
adequate warning concerning its pump.7
In light of the foregoing, we affirm the district court's
entry of summary judgment for Goulds.
AFFIRMED.
7
Our conclusion concerning LA. REV. STAT. ANN. § 9:2800.57(B)(2)
makes it unnecessary for us to address Goulds's additional argument
concerning § 9:2800.57(B)(1). We note, however, that the danger
allegedly caused by the smallness of the drain opening, i.e., the
overflow and accumulation of water on the floor of the paper mill,
was, or at least should have been, obvious to Morgan. We note
further that Louisiana law does not require manufacturers to
provide warnings of dangers which are obvious to the ordinary user.
Beck v. Somerset Technologies, Inc., 882 F.2d 993, 997 (5th Cir.
1989).
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