Verdicts and Rulings

The Court of Appeals handed down a unanimous decision in favor of defendants in a purported Woodson claim July 21, 2020.  Below is a quick synopsis of the case. Kudos to Heather Connor and Christopher Campbell of McAngus, Goudelock & Courie, as well as the late Michael Gibson of Dean & Gibson for helping to hold the line against another run by the plaintiff’s bar at Woodson.

Hidalgo v. Erosion Control Services

(Court of Appeals - Published – 21 July 2020)

Facts:  The decedent employee was killed on July 20, 2016 when the tractor he was driving rolled over on a slope. The employee was ejected from the cab and killed when the tractor rolled on top of him. The evidence showed the employer ECS had replaced the seat on the tractor a year before with one that did not have a seatbelt.

The employee’s estate filed a civil complaint against ECS and its owners. Defendants filed a Motion for Summary Judgment on the grounds that workers’ compensation was the exclusive remedy for workplace injuries. The estate countered that the Woodson exception applied because: (1) the employer replaced the seat without a seatbelt; (2) the tractor was on a slope where it was certain to roll over; and (3) the employer did not train the employee on the risks of driving on such a slope.

The trial court denied ESC’s Motion, but the Court of Appeals reversed and ruled that workers’ compensation was the exclusive remedy for the employee’s death.

Reasoning:  The Court of Appeals began with a discussion of Woodson. In Woodson, an employee was directly instructed by the employer to work in a trench without proper slope protection. The trench collapsed and buried him alive. That employer had several prior OSHA citations for the same issue, and other contractors on the site had prohibited their workers from getting in the trench. The Supreme Court held the employer could be sued in civil court because his actions were so intentional and egregious that they were tantamount to committing an intentional tort against the employee, which is not protected by the rule of exclusivity.

The Court of Appeals then explained the Woodson exception is extremely narrow. It only applies when the uncontroverted evidence shows that the employer intentionally engaged in actions that were substantially certain to result in death or serious bodily injury. Mere negligence, carelessness, or even unsafe actions on the part of the employer are not enough to qualify for the Woodson exception.

In this case, the Court noted the employer did not know the replacement seat he ordered did not come with a seatbelt. The employer himself was not present when the seat was installed, and the tractor had been used for a year without a seatbelt with no injuries. The employer also never directed the employee to drive on the slope where the accident occurred. In fact, no one could explain why the employee was driving on that slope, since it was not a part of the project on which they were working. Therefore, the evidence did not show intentional actions by the employer meeting the Woodson standard.

In January, the 4th Circuit Court of Appeals reaffirmed the U.S. District Court of the Middle District of North Carolina’s summary judgment in Riggins v. Yanceyville in favor of Hagwood & Tipton, attorney Michael Phillips. In this case, the plaintiff claimed the defendant’s negligent care resulted in his mother’s death. The plaintiff’s medical expert failed to testify to a reasonable degree of medical certainty that the death related to the defendant’s failure to provide thickened liquids, resulting in summary judgment. 

The attorney’s excellent briefing and legal application led the Court of Appeals to affirm the District Court on all issues.

THE MEINCK OPINIONS PROVIDE CLARITY ON IMMUNITY, BUT ALTER CONTRACT INTERPRETATION

By: Ryan Bostic, Clawson and Staubes

As many governmental law practitioners are aware, the North Carolina Supreme Court issued a recent ruling on governmental immunity in the case Meinck v. City of Gastonia. In that case, which the NCADA in conjunction with the North Carolina League of Municipalities submitted amicus briefs, the Supreme Court further clarified how to determine if a government actor was engaged in a proprietary function versus a governmental function.

            The facts are rather straight forward. Gastonia purchased a vacant historic building which it then rented to a local art guild as part of a downtown revitalization project.  Gastonia charged rent to the art guild and collected a percentage of any sales. The rent was minor and the income never offset the cost of operating the building.  The arrangement was never designed to turn a profit. The plaintiff was a tenant who fell down a set of steps and was injured. The trial court granted summary judgment in favor of Gastonia finding it was engaged in a governmental function by revitalizing its downtown.

            The Court of Appeals overturned the trial court relying on the factors established in Estate of Williams. In addressing the first factor, “whether the Legislature had addressed the issue,” the Court of Appeals held that the Legislature had not specifically stated that revitalizing a blighted downtown is a government function. The Court of Appeals further held that Gastonia’s activity (leasing property) was not one solely and traditionally provided by a governmental entity and the revenue received was substantial, although it did not cover the operating costs.

            The Supreme Court overturned the Court of Appeals with a majority of the opinion focusing on the General Statutes addressing Urban Redevelopment Law. The Supreme Court repeatedly noted that that governmental immunity is a fact-intensive inquiry that is properly applied on a case-by-case basis. Still, the true value of the opinion is the clarification that the Legislature does not have to use magic words for a government entity to be entitled to immunity. The holding makes clear that lower courts are to look at the purpose behind the activity, not just the activity itself. Moreover, the Supreme Court held that looking at the problem the Legislature was trying to address can be instructive in the determination. The Supreme Court noted that the Court of Appeals did not mention any of applicable General Statutes. 

            Further analysis was conducted on the other Estate of Williams’s factors, but it was stressed that courts and practitioners should not become overly reliant on them. For example, when examining whether it is an activity traditionally undertaken by a government the Supreme Court again looked to the language in the General Statutes for clarification, but found that was not dispositive. When addressing the revenue factor, the Supreme Court reversed a longstanding trend of finding any revenue to be substantial regarding the immunity analysis. The Supreme Court looked at Gastonia’s activity as “decidedly noncommercial” and the testimony that Gastonia never set out to make a profit was persuasive.

            The major takeaway should be to include the reasons that a government actor is engaging in an activity and explain why it benefits the citizenry and not be strictly married the Estate of Williams’s factors. Attorneys need to put forth the purpose of the activity, what problem it addresses, and how the Legislature gave it the ability to do so and why. Regarding revenue, ask did the government actor seek to profit for the activity or did it know going in that it would never become revenue neutral, but undertook the activity because it benefited the citizens. The opinion stresses the inclusion of these arguments at all stages of litigating immunity.  

            The Meinck odyssey did not end at the Supreme Court. The case was remanded to the Court of Appeals to determine if the insurance policy waived governmental immunity. The Court of Appeals in Meinck v. City of Gastonia II found that an ambiguity existed in the insuring agreement and then construed the policy in favor of coverage and a waiver of immunity.

            This holding represents a departure from typical contract principles and appears to create a new subset of law specifically for government insurance contracts preserving immunity. What makes the opinion extraordinary is that no party to the insurance contract thought there was an ambiguity. In fact, one of the two parties to the contract was not a party to the suit. The result was effectively having declaratory judgment entered against the insurer without it being able to defend itself. The Court of Appeals departed from the established precedent of strictly construing the waiver of immunity and determining the intent of the parties, to strictly construing the policy in favor of coverage. This is most telling when one considers that the only evidence in the record was testimony by the City Manager that Gastonia was aware of governmental immunity and sought to preserve it in the insurance contract.

            Admittedly, the language in the policy was not as clear as it could have been. Moving forward, it is imperative that any insuring agreement that looks to preserve immunity state so in the clearest and simplest terms. The question of which legal policy to follow (strictly construing against waiver of immunity vs. strictly construing in favor of coverage) seems to have been resolved in favor of coverage and a waiver of immunity. Therefore, all government entities and their insurers need to assess and potentially revise the language contained in the policies to ensure immunity is preserved.

           

           

           

371 N.C. 497, 819 S.E.2d 353 (2018).

366 N.C. 195, 732 S.E.2d 137 (2012).

823 S.E.2d 459 (N.C. App. 2019).

On April 26, 2018, Judge Carl Fox of the Wake County Superior Court directed a verdict in favor of defendant, St. Clair Foods regarding a case of possible food poisoning. Matthew Little and Lindsey Revels of Teague Campbell represented the defendant who stood accused of selling contaminated potato salad that sickened the plaintiff, Claude Burgess.

Burgess stated he ate the potato salad at the K&W restaurant and that it immediately burned his throat. He continued to eat the potato salad and became violently ill shortly thereafter. K&W and Institution Food House, a food distribution company, had already settled for an undisclosed amount; however, St. Clair Foods chose to take the case to trial. Little detailed the measures to which St. Clair Foods goes to sanitize their facility daily, and stated "St. Clair Foods makes roughly 36 million pounds of potato salad each year...the tub this came from was from a batch of about 5000 portions. If there had been a problem at the plant, hundreds or thousands would have been sick. But only he made a claim." 

The case against St. Clair Foods ended when it was determined there was not enough evidence to hold it responsible. 

On March 27, 2018, a jury in Bumcombe County Superior Court, Judge Tommy Davis presiding, rendered a unanimous verdict for the defendant LJ Wings, Inc., represented by NCADA member Jeremy Stephenson, in a case of dram shop liability.  Ellen Wortman represented co-defendant William Erickson, who had stipulated to his liability before trial.  Plaintiff Dung Trang was represented by attorneys Lakota Denton and Luke Baker.  Trial Judge Davis granted Defendants’ motion to “trifurcate” the case into (1) Wings’ liability, (2) compensatory damages, and if applicable, (3) punitive damages.  The jury ruled for Wings as to liability, and did not reach the other issues.

Mr. Erickson drank at Defendant Wings regularly, and for several hours before the accident. Wings’ witnesses testified to their extensive safe alcohol service training, including how they cut off defendant Erickson, gave him food and water, and asked about how he was getting home. Plaintiff’s counsel made unusual motion in limine to bar Defendants’ use of either plaintiff’s medical bills or records, or wage documentation.  Plaintiff himself also did not attend any part of the trial, from selection to the verdict for Wings.  Costs of $9,276.04 were awarded to Defendant Wings.

On Wednesday, November 14, 2018, after nearly three weeks of trial, a jury returned a unanimous defense verdict in favor of a Lincoln Derr client.

By winning in the first phase of this bifurcated trial Lincoln Derr saved their clients from a potential $10 million exposure. The case involved an alleged hypoxic-ischemic injury to a newborn during labor and delivery. Traditionally, these cases are considered exceptionally difficult to defend because of the emotional response jurors have to injured newborn children. Further, the case was tried in Durham County, a venue previously considered to be very plaintiff-friendly.

When asked about the verdict Gwendolyn Lewis said, “This was my first medical malpractice trial involving an injury to a newborn infant. While the injury to the child was sad, the jury verdict confirmed that physicians can do everything within the standard of care and still have a bad outcome. This verdict goes to the heart of why we do this work, to protect the good names of physicians who are doing their best for their patients.”

This verdict is the fifth defense verdict in medical malpractice trials for Lincoln Derr in 2018. The firm’s medical malpractice group credits their success to unparalleled preparation and ability to disentangle the complex facts of the case to the jury.

Congratulations to Sara Lincoln, Gwendolyn W. Lewis, and Erin Alfaro for successfully defending our client.

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Deb Bowers (with the assistance of Andrew Pinto) won a jury trial in the Western District, Charlotte before Judge Frank Whitney in January, 2017, representing/defending a municipality and several municipal employees and former police chief, mayor and town managers in a civil rights action brought by former residents of the town. One brother was incarcerated on other charges at the time of the lawsuit, and one was living in the county. Included as defendants and separately represented were two former police detectives who were accused of violating the brothers’ civil rights and harassment. Plaintiffs alleged that the actions of the defendants destroyed their business and alleged section 1983 and civil RICO claims against all parties. The almost 2 week long jury trial resulted in a jury finding of no liability on all claims.

Recently, on September 22, 2017, the trial Court ruled on post-trial motions, including an important motion for summary judgment on the statutes of limitations for all claims, which provides additional grounds on appeal for supporting the pre-trial dismissal of the individual City defendants, who were dismissed on qualified immunity grounds immediately before the trial against the City and others.

In Fagundes v. Ammons Development, et al, __ N.C. App. __, __ S.E.2d __ (2017) (2017 WL 495573), a unanimous decision from the North Carolina Court of Appeals issued February 7, 2017, the Court reversed and remanded the lower court’s denial of summary judgment in favor of the defendants employer/co-workers on plaintiff employee’s strict liability claims and held that there is no exception to the exclusivity of the Worker’s Compensation Act for strict liability claims against employer/co-workers by employees injured while employed by a blasting company and engaged in blasting, an ultrahazardous activity. The Court also reversed and remanded the denial of summary judgment on plaintiff’s Pleasant claim.

Jay P. Tobin of Young Moore & Henderson, P.A. represented the employer/co-worker defendants in the lower court and on the appeal.

In June, Judge Robert Ervin granted Directed Verdict in favor of our physician client on the basis that the Continuing Course of Treatment Doctrine did not apply to toll the statute of limitations. Specifically, the Plaintiff’s expert did not present evidence that the defendant doctor could have taken any action at subsequent encounters to remedy the alleged earlier negligence. Therefore, the statute of limitation was not tolled, and the action was not timely filed. Although Judge Ervin did not agree with the controlling case law, he felt bound by it and reluctantly granted our motion.  

Submitted by Scott Addison, Lincoln Derr

Sara Lincoln and Scott Addison get directed verdict. After two weeks of trial, the trial court determined Plaintiffs failed to meet their burden on any of the elements of medical negligence under North Carolina law and directed a verdict in the Defendants’ favor as a matter of law. Plaintiffs' counsel had suggested to the jury that they were going to ask for as much as $40 million in damages in the case.