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Provau v. YRC, Inc.

United States District Court, D. South Carolina, Florence Division

April 28, 2017

YRC, Inc., d/b/a YRC Freight, Inc., and Ricky Walter, Defendants.


          R. Bryan Harwell, United States District Judge

         This matter is before the Court for review of Defendants' re-filed Motion to Dismiss Plaintiff's complaint [ECF #27]. On December 28, 2016, Plaintiff filed a response in opposition to this Motion [ECF #28] and Defendants filed their reply brief on January 4, 2017. [ECF #29]. All parties have had the opportunity to extensively brief the issues raised in the motions, and this Court has thoroughly considered all pleadings filed in this case.[1" name="FN1" id="FN1">1]

         Factual Background and Procedural History

         On December 23, 2015, Plaintiff Christopher Provau (hereinafter, “Mr. Provau” or “Plaintiff”) filed an action in state court seeking damages against YRC, Inc., d/b/a YRC Freight, Inc. (“YRC”) and Ricky Walters (“Mr. Walters”) (collectively, “Defendants”). [ECF #1-1]. Plaintiff alleges in his complaint that he was employed by a vendor to perform repairs on a tractor trailer owned by YRC. [ECF #1-1, p. 5');">p. 5]. Plaintiff's employer, Poston's Trailer Repair, LLC, sent Plaintiff to YRC on the day of the injury. While performing said repairs, Mr. Walters, individually and as an agent and/or employee of YRC, drove away in a truck that was attached to the tractor trailer that Plaintiff was repairing. [ECF #1-1, pp. 5');">p. 5-6]. Plaintiff alleges that as a direct and proximate result of the negligence, gross negligence, and willful and wanton behavior of Defendants, he incurred damages. [ECF #1-1, pp. 6-7]. Defendants filed their notice of removal pursuant to 28 U.S.C. § 1441, et seq. on February 10, 2016. [ECF #1]. That same day, Defendants filed their initial motion to dismiss this action pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure, alleging that Plaintiff's exclusive remedy is through the South Carolina Workers' Compensation Act because he is a statutory employee of YRC. [ECF #4, 3');">p. 3].

         In its Order dated August 25, 2016, this Court allowed Plaintiff additional time to complete discovery, and gave Defendants the opportunity to re-file their motion to dismiss at the conclusion of a sixty-day period. [ECF #16, p. 5');">p. 5]. The parties have had now had the opportunity to conduct discovery, and on December 9, 2016, the Defendants re-filed their motion asserting the same grounds they asserted in their prior motion, but with additional facts to support their argument that Plaintiff is a statutory employee of YRC. The Court now issues the following Order.

         Standard of Review

         Defendants filed their motion to dismiss pursuant to 12(b)(1) of the Federal Rules for Civil Procedure for lack of subject matter jurisdiction. Defendants contend that Mr. Provau was a statutory employee of YRC as defined by The South Carolina Workers' Compensation Act (the “Act”) at the time of the alleged injury, and therefore, his exclusive remedy is under the Act. S.C. Code Ann. § 42-1-400.

         Coverage under the Workers' Compensation Act depends on the existence of an employment relationship. Edens v. Bellini, 3');">597 S.E.2d 863, 866, 359 S.C. 433');">359 S.C. 433 (Ct. App. 2004). Section 42-1-400 provides an exception to the general rule by imposing upon an owner or upstream employer liability for the payment of compensation benefits to worker who is not directly employed by the owner or upstream employer, depending upon the nature of the work performed. Id. The determination of whether a worker is considered a statutory employee is jurisdictional and is a question of law. See Carrier v. Westvaco Corp., 806 F.Supp. 1242, 1244 (D.S.C. 1992) (whether a plaintiff is a statutory employee is a question of subject matter jurisdiction); see also Lentine v. 3M Co., No. 6:08-2542, 2009 WL 792497, at *2 (D.S.C. Mar. 23, 2009) (citing Posey v. Proper Mold & Engineering, Inc., 1 S.E.2d 395');">661 S.E.2d 395, 378 S.C. 210 (Ct. App. 2008)). Notably, South Carolina policy warrants resolving jurisdictional doubts in favor of including employers and employees under the Act. Kemp v. JHN Enters., Inc., No. 6:14-cv-02604, 2016 WL 859361, at *6 (citing Edens v. Bellini, 3');">597 S.E.2d 863, 870 (S.C. Ct. App. 2004)).


         At issue again before this Court is whether Plaintiff is the statutory employee of YRC, such that this Court lacks subject matter jurisdiction to hear this case. Defendants argue that Plaintiff meets the statutory exception found in § 42-1-400 of the Act, which states:

[w]hen any person, in this section and sections 42-1-420 and 42-1-430 referred to as “owner, ” undertakes to perform or execute any work which is a part of his trade, business or occupation and contracts with any other person . . . for the execution or performance by or under such subcontractor of the whole or any part of the work undertaken by such owner, the owner shall be liable to pay any workman employed in the work any compensation under this Title which he would have been liable to pay if the workman had been immediately employed by him. S.C. Ann. § 42-1-400.

         Plaintiff denies this claim, specifying that he performs specialized services to YRC through his employer, Poston Trailer Repair, LLC (“Poston”), and as such did not perform work which was a part of the “trade, business or occupation” of YRC. Plaintiff does not dispute that he was an employee of Poston on the date the alleged injury occurred, nor he does dispute that he was performing repairs on a tractor trailer owned by YRC. [ECF #1-1, p. 5');">p. 5].

         Three alternative tests are applied to determine whether the activity of an employee, such as Plaintiff, of a subcontractor is sufficient to make him a statutory employee as it is defined under § 42-1-400: (1) is the activity an important part of the owner's business or trade; (2) is the activity a necessary, essential, and integral part of the owner's trade, business or occupation; or (3) has the identical activity previously been performed by the owner's employees? Edens, 597 S.E.2d at 868; see also Glass, 482 S.E.2d at 50. The questionable activity need only meet one of the three criteria for the worker to qualify as a statutory employee of the owner or upstream employer. Edens, 597 S.E.2d at 868 (emphasis added).

         Defendants deposed Greg Drake, the 30(b)(6) designee of YRC on October 19, 2016. Mr. Drake testified that the work performed by Plaintiff as the individual sent by Poston to conduct repairs is necessary, essential and integral to YRC's business. [ECF #27-2, pp. 8, 9]. Similarly, Wilson Wayne Poston, the 30(b)(6) designee of Poston, testified that his understanding of the importance of the maintenance and mechanical work his company performs for YRC is “very important for mechanical breakdowns, keeping equipment up. Tires. Is very important.” [ECF #27-3, p. 7]. Mr. Poston ...

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