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Brock v. Price

Supreme Court of North Dakota

October 3, 2019

Huey Brock, Plaintiff, Appellant, and Cross-Appellee
Richard Price and KS Industries, LLC, Defendants, Appellees and Cross-Appellants

          Appeal from the District Court of Mountrail County, North Central Judicial District, the Honorable Douglas L. Mattson, Judge.

          Duane A. Lillehaug (argued), Fargo, North Dakota, and Michael D. Ainbinder (appeared) and Colleen M. Pratt (appeared), Long Beach, California, for plaintiff, appellant, and cross-appellee.

          Seth A. Thompson (argued), Brenda L. Blazer (appeared), and Briana L. Rummel (appeared), Bismarck, North Dakota, for defendants, appellees, and cross-appellants.


          TUFTE, JUSTICE.

         [¶1] Huey Brock appeals from judgments dismissing his negligence action against Richard Price and KS Industries, LLC ("LLC") and awarding Price and LLC costs and disbursements in the amount of $181, 467. Price and LLC cross-appeal from the judgment awarding costs and disbursements. We affirm the district court's summary judgment dismissal of the negligence action because it is barred by the Workforce Safety and Insurance Act's exclusive remedy provisions. We reverse the award of costs and disbursements and remand for the court to hold a hearing on Brock's objections required by N.D.R.Civ.P. 54(e)(2).


         [¶2] LLC is based in Tioga and at all relevant times has obtained Workforce Safety and Insurance ("WSI") coverage for its employees in North Dakota. Brock, a California resident, was hired by LLC and began working as a pipefitter on December 6, 2010. On March 31, 2011, Brock was severely injured in a traffic accident while traveling in a company-owned vehicle with Price and another LLC employee, resulting in Brock becoming quadriplegic. On April 6, 2011, WSI issued a notice of decision accepting Brock's claim and awarding him benefits, which noted "[o]n the above injury date, the injured worker was employed by [LLC]" and "[t]he evidence shows the injured worker sustained an injury by accident arising out of and in the course of employment." Brock began receiving benefits under LLC's WSI account.

         [¶3] In June 2012, Brock, WSI, and LLC entered into a stipulation that Brock would continue to receive WSI benefits while seeking workers' compensation benefits in California from KS Industries, LP ("LP"). The stipulation further provided that WSI would cease paying benefits if his claim against LP's insurance carrier were accepted and his attorney would act in trust for WSI in pursuing reimbursement of funds paid in connection with Brock's claim. Brock then filed an application for California workers' compensation benefits claiming he was employed by LP at the time of the accident. In May 2013, following a trial, a judge of the California Workers' Compensation Appeals Board found:

1. HUEY BROCK born on 09/02/1970 while employed on 03/31/2011 as a pipefitter while working in the State of North Dakota, by, KS INDUSTRIES LP, whose workers' compensation insurance carrier was ACIG Insurance Company, sustained injury arising out of and occurring in the course of employment rendering him a quadriplegic as well as injury to his psyche.
2. As to issue of employment, applicant is found to be an employee of KS INDUSTRIES LP at the time of the injury.
3. As to the issue of jurisdiction, it is found that there is jurisdiction with the California Workers' Compensation Appeals Board over the industrial injuries the applicant sustained herein, and the applicant may proceed to collect such workers' compensation benefits within this State with credit to the defendants for workers' compensation benefits which the applicant may have received from the workers' compensation claim in North Dakota.

         [¶4] In an opinion on his decision, the judge explained:

Based upon applicant's credible testimony which establishes that he was offered and accepted employment from KS Industries LP via the telephone at his residence in Long Beach, California, as well []as the fact that all other entities/campuses listed by defendant are merely alter egos of KS Industries LP (as evidenced by "Exhibit 16" for which applicant was required to submit forms for employment including reading the KS Industries LP safety manual as a requisite of employment and adhering the KS Industries LP "Cell Phone Policy". Also, all payroll was reviewed and approved at the KS Industries LP facility in Bakersfield, California with paychecks and W-2s being issued from KS Industries LP and all employee records, no matter which location/campus the employee worked at, were housed at the KS Industries LP facility in California. Also, all employee[s], once hired, maintained the same "Employee ID" number no matter which location/campus they may perform work. Additionally, applicant credibly testified that for the work in North Dakota, he accepted the employment via the telephone from his residence in Long Beach, California and took a 2 to 3 day bus ride from Long Beach, California to the site in North Dakota based on the belief and reliance that he had been offered and accepted the employment over the telephone.

         A petition for reconsideration and a petition for writ of review to the California Court of Appeals were both denied.

         [¶5] Based on the California administrative decision, LP's workers' compensation carrier commenced paying benefits to Brock and reimbursed WSI all funds expended on Brock. On January 24, 2014, WSI issued a notice of decision reversing its prior decision accepting Brock's claim. Although it is not in the record on appeal, the district court referenced it in its February 8, 2019, order. Prior to oral argument, Brock requested that we take ...

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