James M. Johnson v. Princeton Public Utilities Commission, and third party v. Hydrocon, Inc., Third Party ( 2016 )

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A15-0038
James M. Johnson, et al.,
Appellants,
vs.
Princeton Public Utilities Commission,
defendant and third party plaintiff,
Respondent,
vs.
Hydrocon, Inc.,
Third Party Defendant.
Filed January 4, 2016
Affirmed in part, reversed in part, and remanded
Cleary, Chief Judge
Mille Lacs County District Court
File No. 48-CV-11-2174
James E. Lindell, Grim Daniel Howland, Lindell & Lavoie, LLP, Minneapolis,
Minnesota (for appellants)
Larry D. Espel, Kathryn N. Hibbard, Katherine M. Swenson, Greene Espel PLLP,
Minneapolis, Minnesota (for respondent)
Considered and decided by Schellhas, Presiding Judge; Cleary, Chief Judge; and
Randall, Judge.
UNPUBLISHED OPINION
CLEARY, Chief Judge
In this appeal from a judgment entered following a jury trial of appellants James
Johnson (Johnson) and Sherri Johnson’s negligence claims arising out of an accident at a
construction site, appellants assert that the district court erred by (1) denying their motion
for judgment as a matter of law on liability; (2) denying their motion for a new trial on
damages; (3) granting remittitur of the jury award; and (4) granting respondent Princeton
Public Utilities Commission’s (the PUC) motion for a collateral-source offset. The PUC
cross-appeals, asserting that the district court erred by ruling that appellants’ negligence
claims were not barred by workers’ compensation election of remedies. We affirm in
part, reverse in part, and remand for entry of judgment for appellants in the amount of
$240,000.
FACTS
Appellant James Johnson was employed as a construction worker by third-party
defendant Hydrocon Inc. during the time relevant to this litigation. Hydrocon is a sewer
and water contractor. On August 26, 2009, the PUC and Hydrocon entered a contract
under which Hydrocon was to perform construction work on the water main serving an
ice arena in Princeton, Minnesota. The PUC agreed to secure an electric utility pole so

Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
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that it would not fall while Hydrocon dug a ditch nearby. On the morning of August 31,
2009, employees of the PUC arrived at the construction site in order to secure the pole.
The PUC employees used a digger truck to secure the utility pole and
disconnected the utility wires from the pole so it would be out of service during the water
main work. Hydrocon was not involved in securing the pole. After multiple employees
of the PUC secured the pole, one employee, Thomas Otto, remained at the site all day to
supervise the pole.
Johnson operated the compacting machine, a ride-on vehicle that packs loose soil.
When the work near the pole was complete, Johnson informed Otto that Hydrocon
employees were done working near the pole, at which time Otto released the pole from
the digger truck that was securing it. Shortly after Otto drove the digger truck away from
the pole, it fell onto the roof of the compacting machine that Johnson was driving.
On February 15, 2011, Johnson reached a settlement regarding this incident with
Hydrocon’s workers’ compensation insurance providers. On September 30, 2011,
Johnson and his wife, appellant Sherri Johnson, filed a complaint against the PUC. The
PUC filed a third-party complaint against Hydrocon. After a settlement between the PUC
and Hydrocon, the Johnsons and PUC went to trial.
After trial, the jury returned a special-verdict form that contained three sets of two
questions regarding the parties’ negligence. These questions asked (1) if the PUC was
negligent and (2) whether the PUC’s negligence was a direct cause of Johnson’s injuries,
(3) if Johnson was negligent and (4) whether Johnson’s negligence was a direct cause of
his injuries, (5) if Hydrocon was negligent and (6) whether Hydrocon’s negligence was a
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direct cause of Johnson’s injuries. The instructions stated that if the jury answered “yes”
to two or more of questions two, four, or six, meaning that more than one of the PUC,
Johnson, or Hydrocon had been negligent in a way that directly caused Johnson’s
injuries, only then should they answer question seven regarding apportionment of fault.
As to the PUC, the jury found it had been negligent and the negligence was a direct cause
of the injury. As to Johnson, the jury found he had been negligent but the negligence was
not a direct cause of the injury. As to Hydrocon, the jury found it was not negligent.
Despite finding only the PUC’s negligence directly caused the injury, the jury went on to
answer question seven, apportioning 70% of fault to the PUC and 30% to Johnson. The
jury valued damages at $240,000. Despite the inconsistent verdict, the judge dismissed
the jury.
On January 17, 2014, the district court ordered a new trial based on the jury’s
inconsistent special-verdict answers. Appellants objected to this decision. On May 13,
the district court offered appellants a remittitur, allowing them “to choose between entry
of judgment for seventy percent of the original jury verdict . . . or a new trial.”
Appellants did not reject remittitur. On July 14, the court entered a judgment for
appellants in the amount of $134,085.
Appellants and respondent both made post-trial motions. Appellants argued for
judgment as a matter of law (JMOL) that the PUC was the only party causally negligent
in the accident for JMOL with respect to damages and, in the alternative, for a new trial
on damages. Appellants also moved to vacate the district court’s ruling on collateral-
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source offsets. Respondent sought JMOL as to its liability and filed a motion for fees and
costs. All motions were denied. This appeal followed.
DECISION
Common enterprise
We review a district court’s denial of a motion for JMOL de novo. Bahr v. Boise
Cascade Corp., 766 N.W.2d 910, 919 (Minn. 2009). However, “we view the evidence in
the light most favorable to the prevailing party.” Id.[JMOL] should be granted: only in those unequivocal cases
where (1) in the light of the evidence as a whole, it would
clearly be the duty of the [district] court to set aside a
contrary verdict as being manifestly against the entire
evidence, or where (2) it would be contrary to the law
applicable to the case.
Jerry’s Enters., Inc. v. Larkin, Hoffman, Daly & Lindgren, Ltd., 711 N.W.2d 811, 816
(Minn. 2006) (quotation omitted).
Respondent appeals the district court’s denial of its motion for JMOL. It argues
that the PUC and Hydrocon were engaged in a common enterprise and therefore,
appellants’ negligence claims fail as a matter of law. When an employer and a third party
are working in “furtherance of a common enterprise,” an injured employee must choose
between receiving workers’ compensation benefits through the employer or pursuing a
common-law negligence action against the third party. Minn. Stat. § 176.061, subds. 1, 4
(2014). A common enterprise exists between the employer and the third party where “the
masters have joined forces and in effect have put the servants into a common pool.”
Gleason v. Geary, 214 Minn. 499, 511, 8 N.W.2d 808, 814 (1943). This is the case
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where the following factors are satisfied: “(1) [t]he employers must be engaged on the
same project; (2) [t]he employees must be working together (common activity); and
(3) [i]n such fashion that they are subject to the same or similar hazards.” McCourtie v.
U.S. Steel Corp., 253 Minn. 501, 506, 93 N.W.2d 552, 556 (1958). An employee’s
recovery on a workers’ compensation claim precludes a tort claim based on the same
incident against a third party engaged in a common enterprise with the employer.
O’Malley v. Ulland Bros., 549 N.W.2d 889, 893 (Minn. 1996).
The district court determined that the first McCourtie factor was satisfied because
the PUC employees’ sole purpose in being on site that day was to secure the utility pole
to allow Hydrocon employees to do their work on the water main. However, it
determined that the second and third factors were not satisfied and denied respondent’s
motion for JMOL.
Respondent argues that because appellants/cross-respondents did not file a notice
of related appeal disputing the district court’s finding that the first McCourtie factor was
satisfied, this issue is waived. Because the second and third McCourtie factors are not
satisfied, we need not reach the issue of whether the first factor was preserved on appeal.
The second factor is whether the employees were engaged in a common activity.
Whether this factor is satisfied “is a question that focuses on the functions performed by
the employees, not on the goals of their employers.” LeDoux v. M.A. Mortenson Co., 835
N.W.2d 20, 22-23 (Minn. App. 2013) (citing Schleicher v. Lunda Constr. Co., 406
N.W.2d 311, 313 (Minn. 1987)). “To be common, the employees’ activities must not
merely overlap minimally, they must be interdependent.” Id. at 23 (quotation omitted).
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The LeDoux court held that “[w]orking in the same area at the same time does not alone
establish an interdependent common activity since the activities were apparently distinct
and apparently could have been performed at different times.” Id. The mere fact that
employees may be working toward a common goal is insufficient. Schleicher, 406
N.W.2d at 313.
At the construction site, the PUC and Hydrocon employees largely worked
independently of each other. There was no evidence that Hydrocon employees were
involved in securing the pole or that employees of the PUC were involved in digging the
water-main trench. Additionally, taking the facts in the light most favorable to the
judgment, when the pole fell, Otto had driven his truck away from where Johnson was
driving the compactor. Johnson was engaged in different work than employees of the
PUC with little coordination or communication, and when the accident occurred, there
were no employees of the PUC present in the immediate area. Otto—the only employee
of the PUC present at the worksite—and Johnson were not engaged in a common activity
at the time of the accident.
The third factor is whether the employees were subject to the same or similar
workplace hazards. “The same or similar hazards requirement does not demand exposure
to identical hazards, only similar hazards.” Olson v. Lyrek, 582 N.W.2d 582, 584 (Minn.
App. 1998), review denied (Minn. Oct. 20, 1998). “In determining whether workers are
exposed to similar hazards, [courts] make a comparison of the general risks to which
workers are exposed as a result of the tasks being performed.” Id.7
In Olson, a foreman was injured while laying pipe in a trench that was
simultaneously being excavated by a backhoe operator. Id. The operator negligently
drove the backhoe into the trench, landing on the foreman and injuring both workers. Id.Despite the fact that the workers were injured due to the same action, the court found that
the third McCourtie factor was not satisfied because “the general risks facing [the
backhoe operator] were fundamentally different from the risks facing [the foreman]
because they were performing separate tasks.” Id. The risks were not the same because
the foreman and operator “did not use the same equipment, nor did they work in the same
physical areas. [The foreman] was down in the trench and [the operator] was sitting in an
enclosed cab several feet above the trench.” Id.The facts in this case mirror Olson. Hydrocon employees had very different tasks
than the PUC employees. They used different equipment and worked in different spaces.
As the district court noted, the general risks facing Hydrocon employees were “trench
cave-ins” and other dangers associated with working in a trench, whereas the PUC
employees “were subject to the risk of electric shock from disconnecting and
reconnecting electrical service to the utility pole.” Respondent’s argument that this factor
is satisfied because employees of the PUC also faced the risk of a falling pole conflicts
with Olson. In that case, employees of the two companies were actually injured by the
same instrument, but the court stated “[t]he focus . . . is not on the instrument that caused
the injury.” Olson, 582 N.W.2d at 584. Instead the focus is on the general risks of the
tasks performed. Id. Under Olson, this third McCourtie factor is not satisfied where
there is only small overlap between the risks faced by the two groups of employees, even
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where that overlapping risk is what actually causes the harm. The district court correctly
concluded that the general risks were not common among Hydrocon and employees of
the PUC.
Employees of the PUC and Hydrocon were not engaged in a common activity and
did not face similar hazards. The district court did not err in denying respondent’s
motion for JMOL on the issue of common enterprise.
New trial on damages
Appellants appeal the district court’s decision denying a motion for a new trial on
damages. “We review a district court’s new trial decision under an abuse of discretion
standard.” Moorhead Econ. Dev. Auth. v. Anda, 789 N.W.2d 860, 892 (Minn. 2010). An
appellate court “will not set aside a jury verdict on an appeal from a district court’s denial
of a motion for a new trial unless it is manifestly and palpably contrary to the evidence
viewed as a whole and in the light most favorable to the verdict.” Navarre v. S. Wash.
Cnty. Schs., 652 N.W.2d 9, 21 (Minn. 2002) (quotations omitted).
First, appellants argue that the district court incorrectly permitted respondent to
cross-examine Johnson regarding a previous injury settlement. “The jury shall not be
informed of the existence of collateral sources or any future benefits which may or may
not be payable to the plaintiff.” Minn. Stat. § 548.251, subd. 5 (2014). However, such
evidence may be admitted “when a plaintiff, through either the use of misleading
statements or outright false statements, falsely conveys to the jury that he or she is
destitute or in dire financial straits.” Kroning v. State Farm Auto. Ins. Co., 567 N.W.2d
42, 46 (Minn. 1997).
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Appellants presented direct testimony that appellant was unable to sign up for
college courses because “[h]e doesn’t have the money.” On direct examination, Johnson
stated that he hoped to enroll in a college program but had been unable to. The court
found that “the general tenor of [Johnson’s] testimony suggested that finances had
prevented him” from enrolling in college, and that testimony presented by appellants
“painted an unnecessarily dire picture of the Johnson family’s financial condition.” The
evidence provides support for the conclusion that Johnson was conveying to the jury that
financial struggles resulting from the accident prevented him from mitigating damages by
pursuing a degree. The district court determined that appellants had opened the door to
collateral-source evidence through its direct evidence. This determination was not an
abuse of discretion.
The district court also did not abuse its discretion by excluding evidence of a
settlement between the PUC and Hydrocon. Evidence of accepting “valuable
consideration in compromising . . . a claim which was disputed as to either validity or
amount, is not admissible to prove liability.” Minn. R. Evid. 408. Appellants argue that
the claim settled between the PUC and Hydrocon was not disputed and thus rule 408 does
not apply. However, the liability release agreed to by the PUC and Hydrocon stated the
payment was made “to compromise a disputed and contested claim.” The decision to
exclude evidence of the settlement was not an abuse of discretion.
Finally, appellant argues that the district court erred by not granting a new trial
based on the jury’s decision to award no damages for past medical expenses, future
bodily and mental harm, loss of future earning capacity, or loss of consortium.
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“Generally, a new trial on damages will be granted only where the verdict is so
inadequate or excessive that it could only have been rendered on account of passion or
prejudice.” Rush v. Jostock, 710 N.W.2d 570, 577 (Minn. App. 2006) (quotation
omitted), review denied (Minn. May 24, 2006). “A trial court has the broadest possible
discretion to determine whether a new trial should be granted based on an inadequate
award of damages.” Id. This decision should not be reversed “absent a clear abuse of
that discretion and the existence of the most unusual circumstances.” Pulkrabek v.
Johnson, 418 N.W.2d 514, 516 (Minn. App. 1988) (quotation omitted), review denied
(Minn. May 4, 1988).
As to past and future medical expenses, appellants argue that they were entitled to
damages as a matter of law because “there was no dispute regarding the past healthcare
expenses attributable to [Johnson’s] cervical surgery and treatment.” However, there was
evidence presented that Johnson had a preexisting cervical injury. In 2003, Johnson was
diagnosed with “degenerative disc disease of the cervical spine.” Respondent’s medical
expert testified that the 2009 worksite accident had aggravated this preexisting condition.
The district court held that the jury could have concluded that “the accident was merely a
minor factor that hastened an already inevitable surgery.” Under this understanding of
the evidence, the jury could reasonably find that the past healthcare expenses and the
future bodily and mental harm were not causally attributable to respondent’s actions but
rather to the preexisting injury.
Respondent also presented evidence that Johnson’s loss of future earning capacity
was not attributable to the accident. Respondent’s medical expert testified that continued
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pain in Johnson’s neck was attributable to his preexisting condition, not the accident.
Taking the evidence in the light most favorable to the verdict, the jury could have
credited this testimony and concluded that any reduction in future earning capacity was
not attributable to respondent’s actions. Similarly, if the jury credited this testimony, it
could reasonably conclude that any loss of consortium to Sherri Johnson was not
attributable to respondent’s actions. Taken in the light most favorable to the verdict,
there is evidence to support the conclusion that all of the damages appellants challenge on
appeal were not attributable to the accident. The court did not abuse its discretion by
denying appellants’ motion for a new trial.
Collateral-source offset
Appellants argue that the district court erred by hearing respondent’s untimely
motion and granting respondent a $48,450 collateral-source offset. Respondent argues
that the district court erred by not granting a greater collateral-source offset. When
reviewing a district court’s decision on collateral-source offsets, which is a mixed
question of law and fact, “we will correct erroneous applications of law, but accord the
[district] court discretion in its ultimate conclusions and review such conclusions under
an abuse of discretion standard.” Graff v. Robert M. Swendra Agency, Inc., 776 N.W.2d
744, 752 (Minn. App. 2009) (alteration in original) (quotation omitted) aff’d, 800 N.W.2d
112 (Minn. 2011).
Minnesota law allows a party who has been found liable for injury or disability to
seek a reduction in the jury award for compensation that the plaintiff has already obtained
from collateral sources. Minn. Stat. § 548.251 (2014). The statute defines “collateral
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sources,” in relevant part, as “payments related to the injury or disability in question” to
the plaintiff up to the date of the verdict based on “a federal, state or local . . . Workers’
Compensation Act.” Id., subd. 1. If the court finds that the injured party has received
payment from collateral sources or that such sources are available to the injured party, it
must reduce the jury award by the collateral-source amount. Id., subd. 3(a). The purpose
of the statute is to prevent double recovery by the plaintiff. Heine v. Simon, 702 N.W.2d
752, 764 (Minn. 2005).
Appellants argue that the district court erred by hearing and granting the PUC’s
motion for collateral-source offsets because the motion was untimely. Minnesota law
states that “when damages include an award to compensate the plaintiff for losses
available to the date of the verdict by collateral sources, a party may file a motion within
ten days of the date of entry of the verdict requesting determination of collateral sources.”
Minn. Stat. § 548.251, subd. 2. “The filing of a district court’s order for judgment
pursuant to a jury’s special verdict triggers the time to file a motion for determination of
collateral sources.” Braginsky v. State Farm Mut. Auto. Ins. Co., 624 N.W.2d 789, 795-
96 (Minn. App. 2001).
Here, respondent made its collateral-source motion on October 29, 2013, while the
entry of judgment did not occur until July 14, 2014. Under the statute, respondent did not
file its motion “within ten days of entry of the verdict,” but rather over eight months
before entry of the verdict. Respondent did not follow the collateral-source statute and
the district court abused its discretion by granting the untimely motion. Because it did
not make a timely motion, the PUC is not entitled to a collateral-source offset.
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Remittitur
At the conclusion of trial, the jury gave conflicting answers on the special-verdict
form. The jury indicated in response to question four that Johnson’s negligence was not a
direct cause of his injury but, contrary to instructions, answered question seven,
apportioning Johnson 30% of the fault for the injury and the PUC 70% of the fault. After
failing to ask the jury to reconcile the responses before dismissing it, the trial court
offered appellants the choice to accept the court’s entry of a remittitur awarding
appellants 70% of the original verdict, or to reject the remittitur, in which case the court
would hold a new trial. Appellants argue that the district court should have entered a
verdict for the full amount of the jury award because, under the circumstances, the jury
should not have answered question seven.
“A trial court has broad discretion to liberally construe an inconsistent verdict to
effect the intention of the jury and to harmonize answers if possible.” Hampton Bank v.
River City Yachts, Inc., 528 N.W.2d 880, 892 (Minn. App. 1995) (quotation omitted),
review denied (Minn. Apr. 27, 1995). However, “[a]ppellate courts also may direct that
one of the answers be changed as a matter of law.” Bogut v. Jannetta, 410 N.W.2d 451,
454 (Minn. App. 1987).
In Daly v. McFarland, the supreme court reversed a district court’s decision not to
grant remittitur where the jury’s answers to the special-verdict form stated that the
plaintiff’s negligence had not directly caused the accident, but nonetheless apportioned
fault to the plaintiff. 812 N.W.2d 113, 118-19 (Minn. 2012). In that case, the jury had
been instructed to answer the apportionment-of-fault question regardless of how it
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answered the causation question. Id. at 126. The supreme court reasoned that, because
the jury’s answers conflicted on two questions that the court had instructed them to
answer, the district court abused its discretion by ignoring the jury’s answer to the
apportionment question and finding the plaintiff had no causal negligence. Id. at 126-27.
In this case, the jury was instructed that it should only answer question seven
regarding apportionment of fault if it answered “yes” to two or more of questions two,
four, or six. Of these, it answered “yes” only to question two. Unlike in Daly, the district
court in this case did not need to reconcile two required jury findings that conflicted. The
jury was instructed not to answer question seven under these circumstances, and it should
not have done so. Because the jury’s answers on questions one through six meant that it
was not to answer question seven, any answer to that question has no legal effect. See
Furlev Sales & Assocs., Inc. v. N. Am. Auto. Warehouse, Inc., 325 N.W.2d 20, 28 (Minn.
1982) (stating that jury “instructions [become] the law of the case”). The district court
abused its discretion by reducing appellants’ damages based on this answer, which had no
effect as a matter of law. The remittitur must be reversed, and this case is remanded for
entry of judgment for the full amount of the jury verdict, $240,000.
Affirmed in part, reversed in part, and remanded.
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