William N. Keller v. Cleadieus McLeod

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

CA 03-267

WILLIAM M. KELLER

VERSUS

CLEADIEUS MCLEOD, ET AL.

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APPEAL FROM THE
FOURTEENTH JUDICIAL DISTRICT COURT,
PARISH OF CALCASIEU, NO. 97-8098
HONORABLE FRED GODWIN, DISTRICT JUDGE

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JIMMIE C. PETERS
JUDGE

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Court composed of Sylvia R. Cooks, John D. Saunders, and Jimmie C. Peters,
Judges.

AFFIRMED.

Rudie J. Soileau, Jr.
Thomas Townsley
717 Pujo St.
Lake Charles, LA 70601
(337) 433-0110
COUNSEL FOR PLAINTIFF/APPELLANT:
William M. Keller

Charles N. Harper
Swift, Spears & Harper, L.L.P.
1135 Lakeshore Dr., 4th Floor
Lake Charles, LA 70601
(337) 433-0707
COUNSEL FOR DEFENDANT/APPELLEE:
Hercules, Inc.

Patrick J. Briney

Richard R. Montgomery
Briney & Foret
P. O. Box 51367
Lafayette, LA 70505-1367
(337) 237-4070
COUNSEL FOR DEFENDANTS/APPELLEES:
Load Right Timber Sales, Inc.
Clarendon National Insurance Co.

Michael E. Parker
Allen & Gooch
P. O. Drawer 3768
Lafayette, LA 70502-3768
(337) 291-1350
COUNSEL FOR INTERVENORS/APPELLANTS:
Kenneth Parker Logging, Inc.
Louisiana Safety Association of Timbermen Self Insurer’s
Fund
Safety National Casualty Corporation
Sedgwick Claims Management Services, Inc.

PETERS, J.

William M. Keller and his wife, Audrey, brought this suit to

recover damages for injuries he sustained in an

October 15, 1996 accident that occurred at the

Hercules, Inc. (Hercules) plant located in

Lumberton, Mississippi. After Mr. Keller presented

his evidence at trial, the trial court granted a directed

verdict in favor of Load Right Timber Sales, Inc.

(Load Right) and its insurer, Clarendon National

Insurance Company, 1 dismissing them from the

litigation. Mr. Keller and various intervenors in the

litigation2 (hereinafter referred to collectively as

“Parker Logging”) appeal the trial court judgment

granting the directed verdict. The trial court

rendered a subsequent judgment granting Hercules’

peremptory exception of prescription and dismissing

it from the litigation. Mr. Keller and Parker Logging

appeal that judgment as well. For the following

reasons, we affirm the trial court’s judgments in all

respects.

DISCUSSION OF THE RECORD

The facts applicable to the judgments below are not in dispute.

1
For purposes of this opinion, we will refer only to Load Right when referencing its insurer
as well.
2
The intervenors included Kenneth Parker Logging, Inc., Mr. Keller’s borrowing employer;
Louisiana Safety Association of Timbermen Self Insured Fund and Safety National Casualty
Corporation, the workers’ compensation carriers; and Sedgwick CMS, the third-party administrator
of the claim. As stated above, for convenience, we will refer to all intervenors collectively as
“Parker Logging.”

2

Load Right is in the business of buying and selling

trees, leasing and renting flatbed trailers, and

delivering tree stumps to various locations. Hercules

uses tree stumps at its various facilities, including its

Lumberton, Mississippi facility. Accordingly, on

January 11, 1996, Load Right and Hercules entered

into two written contracts for the harvesting and

hauling of “dead pine stumps and dead and down

pine topwood” (hereinafter referred to collectively as

“stumps”), namely, the “Harvesting Contract” and

the “Freight Contract.” Pursuant to these contracts,

Hercules agreed to pay Load Right to harvest tree

stumps from various locations specified by Hercules

and to haul the stumps to Hercules’ facilities.

At the time the parties entered into these contracts, Load Right

owned flatbed trailers capable of carrying the

stumps. However, according to Cleadieus McLeod,

one of Load Right’s owners, the company “desired

to have self-insured contractors doing as much of the

[Hercules contract] work as possible.” Because

Load Right had an ongoing business relationship

with Parking Logging, it engaged Parker Logging to

extract the stumps from the ground. Additionally,

because it also had an ongoing business relationship

with Michael W. Savell Trucking (Savell Trucking),

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Load Right negotiated an agreement with Savell

Trucking on behalf of Parker Logging whereby

Savell Trucking would provide the tractor rigs and

drivers to pull the flatbed trailers once the trailers

were loaded with stumps. Pursuant to these

agreements, Savell Trucking would deliver the

flatbed trailers to the harvesting location, where they

would be loaded after Parker logging had extracted

the stumps. After the trailers were loaded, Savell

Trucking drivers would transport them to the

Hercules facility.

Mr. Keller was one of the drivers employed by Savell Trucking.

On October 15, 1996, he picked up a load of stumps

and delivered them to Hercules’ Lumberton facility.

While cleaning dirt and debris from the flatbed

trailer after the stumps had been unloaded, Mr.

Keller sustained injuries when his left foot fell

through a hole in the wooden floorboard of Load

Right’s trailer. Parker Logging provided workers’

compensation benefits in connection with Mr.

Keller’s injuries.

On October 8, 1997, Mr. Keller and his wife3 filed the instant suit,

initially naming only Load Right and Mr. McLeod4

3
Mrs. Keller later dismissed her claim.
4
Before trial, the trial court granted a summary judgment dismissing Mr. McLeod as a party
defendant.

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as defendants. Shortly thereafter, on October 20,

1997, Parker Logging filed a petition of intervention

seeking reimbursement for indemnity and medical

benefits paid on behalf of Mr. Keller. Mr. Keller

added Hercules as a defendant on July 10, 1998.

The case went to trial against the remaining defendants. At the

close of the presentation of evidence by Mr. Keller,

Load Right moved for a directed verdict on the basis

that it was Mr. Keller’s statutory employer and as

such was entitled to statutory immunity. The trial

court granted the directed verdict and dismissed the

claim against Load Right.

Hercules then filed an exception of prescription, which the trial

court declined to rule on at the time. The case

thereafter proceeded with Hercules as the only

defendant. Upon completion of the presentation of

all evidence, the jury returned a verdict establishing

Mr. Keller’s damages at $731,000.00 and

apportioning the fault among the various parties

causing Mr. Keller’s injuries as follows: Hercules,

10%; Load Right, 50%; Savell Trucking, 37%; and

Mr. Keller, 3%. Thereafter, the trial court granted

Hercules’s exception of prescription and dismissed

the claims against it. Mr. Keller and Parker Logging

filed a motion for new trial, which the trial court

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denied.

Mr. Keller and Parker Logging then timely filed this appeal,

asserting that the trial court erred in granting Load

Right’s directed verdict and in granting Hercules’

exception of prescription.

OPINION

Statutory Employer Defense

The rights and remedies granted to an employee under the

Workers’ Compensation Act are exclusive of all

other rights, remedies, and claims for damages,

except for intentional acts, against any principal.

La.R.S. 23:1032(A)(1)(a). “[T]he word ‘principal’

shall be 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 had contracted to

perform and contracts with any person for the

execution thereof.” La.R.S. 23:1032(A)(2).

Louisiana Revised Statutes 23:1061(A) provided at

the time of the accident the following in part:

When any person, in this Section referred to as the “principal”,
undertakes to execute any work, which is a part of his trade, business, or
occupation or which he had contracted to perform, and contracts with any
person, in this Section referred to as the “contractor”, for the execution by or
under the contractor of the whole or any part of the work undertaken by the
principal, the principal shall be liable to pay to any employee employed in the
execution of the work or to his dependent, any compensation under this Chapter
which he would have been liable to pay if the employee had been immediately
employed by him; and where compensation is claimed from, or proceedings

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are taken against, the principal, then, in the
application of this Chapter reference to the principal
shall be substituted for reference to the employer . .
..

Parker Logging urges this court to recognize a temporal element

in the two-contract theory under La.R.S. 23:1061 for

statutory immunity purposes. Specifically, it asserts

that this court should recognize that in order for the

general contractor to avail itself of statutory

immunity, the contract between the principal and the

general contractor must predate the contract between

the general contractor and the subcontractor. Here,

Parker Logging and Load Right had a preexisting

relationship. Parker Logging contends that when

Load Right entered into the contracts with Hercules,

nothing had changed between Load Right and Parker

Logging other than the amount of work being done

and the destination of the trucks. In other words,

there was no “new” contract in which Load Right

made specific arrangements with Parker Logging to

provide trucks, equipment, or drivers as a result of

the contract with Hercules. Thus, Parker Logging

contends that the trial court erred in granting the

directed verdict because the “temporal element is

lacking in this case.”

Without commenting on whether the ongoing business

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relationships were sufficient to constitute preexisting

contracts in any event, we note that during the

pendency of this appeal the supreme court decided

Allen v. State, through Ernest N. Morial—New

Orleans Exhibition Hall Authority, 02-1072 (La.

4/9/03), 842 So.2d 373, in which it concluded that

La.R.S. 23:1032 and La.R.S. 23:1061 impose no

temporal requirement on the two-contract defense.

Thus, we reject Parker Logging’s assignment of error

in this regard.

Nevertheless, Mr. Keller asserts that Load Right did not assert the

two-contract defense until the “eve” of trial and that,

in any event, the two-contract defense requires a

service contract, not a sales contract. He contends

that the contract between Load Right and Hercules

was an agreement of sale, while the contract between

Load Right and Parker Logging/Savell Trucking was

a service agreement.

As we appreciate Mr. Keller’s position, he does not dispute that

Load Right timely filed the affirmative defense of

statutory immunity. Rather, Mr. Keller asserts that

at the time the affirmative defense of statutory

immunity was raised, Load Right urged the defense

only pursuant to the “trade, business, or occupation”

portion of La.R.S. 23:1061(A), and not pursuant to

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the two-contract portion of that same statute. The

trial court found that there was “no prejudice to [Mr.

Keller] in this instance because [he had] known all

along that there’s a statutory immunity pled.”

Pursuant to La.Code Civ.P. art. 1005, “[t]he answer shall set forth

affirmatively . . . any . . . matter constituting an

affirmative defense.” Importantly, “[t]he policy

behind [La.Code Civ.P. art. 1005] is the prevention

of ‘trial by ambush.’” Patterson v. State, 95-1668,

p. 8 (La.App. 3 Cir. 12/11/96), 685 So.2d 473, 478,

writs denied, 97-27, 97-108 (La. 2/21/97), 688 So.2d

513. “[T]ort immunity provided by the [Workers’

Compensation] Act operates as an affirmative

defense . . . .” Brown v. Adair, 02-2028, p. 5 (La.

4/9/03), 846 So.2d 687, 690. Because Mr. Keller

was well aware of the affirmative defense of tort

immunity, there was no trial by ambush. Mr. Keller

has cited us to no authority, nor are we aware of any,

that would require forfeiture of a timely pled

affirmative defense because the specific bases of that

defense were not disclosed until the “eve” of trial.

Thus, we reject Mr. Keller’s argument in that regard.

Concerning the nature of the contracts between Load Right and

Hercules, the supreme court in Allen, 842 So.2d 373,

383, set forth the requirements of the two-contract

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defense: “[I]n order to raise the ‘two contract’

defense, a defendant must establish only that: (1) it

entered into a contract with a third party; (2)

pursuant to that contract, work must be performed;

and (3) in order for the defendant to fulfill its

contractual obligation to perform the work, the

defendant entered into a subcontract for all or part of

the work performed.” In the instant case, Load Right

entered into a harvesting contract and a freight

contract with Hercules; pursuant to the contracts,

Hercules agreed to “buy” stumps from Load Right

which were “harvested by [Load Right] from

locations specified by Hercules and delivered to

Hercules”; and, in order to fulfill its contractual

obligations to harvest and deliver the stumps, Load

Right entered into subcontracts with Parker Logging

and Savell Trucking for this portion of the work to

be performed.

However, because the contracts between Load Right and Hercules

contained elements of sale, Mr. Keller argues that the

two-contract defense is not available to Load Right.

In support, Mr. Keller cites Insurance Co. of North

America v. Gaylord Container Corp., 99-904, 99-

905 (La.App. 1 Cir. 6/23/00), 764 So.2d 1214. In

that case, Murphy Johnny LaBauve was employed as

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a truck driver for V. B. Fairley. Apparently in the

course of this employment, Mr. LaBauve delivered

pulpwood to Gaylord Container Corporation on

behalf of Whitfield Timber Company. While on the

Gaylord premises, Mr. LaBauve fell into a hole. The

first circuit explained that the two-contract defense

was not applicable and analyzed it instead under the

“trade, business, or occupation” provision of La.R.S.

23:1061(A). The first circuit ultimately concluded

as follows:

The agreement between Gaylord and Whitfield was thus limited to the
price that Gaylord agreed to pay for received deliveries by Whitfield. LaBauve
was performing the single service of delivering pulpwood at the Gaylord site
for the purpose of selling it to Gaylord on behalf of Whitfield. The lack of any
obligation by Whitfield to sell to Gaylord, or to perform a specific service in
favor of Gaylord, negates the possibility that Fairley’s employee was a statutory
employee of Gaylord. Moreover, although Gaylord appears to have
customarily bought any pulp wood that was delivered by its various dealers,
there has been no demonstration that it was under any legal obligation to do so.

Id. at 1217-18.

In the instant case, Load Right was to perform work in fulfillment

of the contracts with Hercules to the extent of

harvesting and then delivering the stumps.

Moreover, Mr. Keller admits that the contracts

between Load Right and Parker Logging and Savell

Trucking were service contracts. Although

interpreting a different version of the statute, the

supreme court in Hart v. Richardson, 272 So.2d 316,

319 (La.1973), explained: “There is no reference in

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the act to an exclusion from coverage because there

exist elements of a vendor-vendee relationship

between the injured workman and the one sought to

be held as an employer. If all the other elements are

present required by the act before there is coverage

. . . and the injured workman is performing a

necessary and indispensable activity which is part of

the business operation of the one sought to be held as

‘employer,’ the mere fact that elements of sale are

present in the relationship will not defeat recovery.”

Likewise, under the version of La.R.S. 23:1061 in effect at the

time of the accident, there is no reference to an

exclusion from coverage because elements of a

vendor-vendee relationship exist in one of the two

contracts at issue. All that is required is that the

principal “undertakes to execute any work . . . which

he ha[s] contracted to perform, and contracts with

any person . . . for the execution by or under the

contractor of the whole or any part of the work

undertaken by the principal.” La.R.S. 23:1061(A).

We find no error in the trial court’s determination

that Load Right was the statutory employer of Mr.

Keller.

Prescription

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Finally, Parker Logging and Mr. Keller contend that the trial

court erred in finding that Mr. Keller’s timely filed

suit against Load Right did not interrupt prescription

against Hercules where Load Right was ultimately

dismissed from the suit.

“Interruption of prescription against one joint tortfeasor is

effective against all joint tortfeasors.” La.Civ.Code

art. 2324(C). Further, “a suit timely filed against the

employer for worker’s compensation interrupt[s]

prescription as to the subsequent claim against the

third party tort-feasor for damages.” Williams v.

Sewerage & Water Bd. of New Orleans, 611 So.2d

1383, 1390 (La.1993). In the instant case, Load

Right was dismissed from the suit as being

statutorily immune from tort liability, and there is no

indication in the record that suit was timely filed

against Load Right for workers’ compensation

benefits.

In Layman v. City of New Orleans, 98-0705 (La.App. 4 Cir.

12/9/98), 753 So.2d 254, Arthur Layman timely filed

suit against several defendants, including the New

Orleans Convention Center, in connection with

injuries he sustained while working at the

Convention Center. Over four years after the alleged

accident, Mr. Layman amended his original petition

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to add Hufcor as a defendant. The trial court granted

Hufcor’s exception of prescription, and Mr. Layman

appealed. The fourth circuit affirmed, stating:

The Convention Center is the acknowledged employer of the plaintiff. Layman
sued only for negligence damages. He did not sue for worker’s compensation
benefits. Hufcor concedes that a claim against an employer for compensation
benefits is solidary with the employee’s claim against third party tortfeasors.
But Hurcor argues that an employee has no cause of action against an immune
employer for negligence. Therefore, Layman’s suit which asserts no
compensation claim against the Convention Center fails to state a cause of
action for negligence against the Convention Center. Accordingly, plaintiff’s
suit asserts no claim against the Convention Center upon which a solidary
relationship with Hufcor can be based. We conclude that the naming of the
Convention Center as a defendant does not interrupt prescription as to Hufcor.

Id. at 256-57 (citations omitted) (footnote omitted).

Additionally, in Williams v. Holiday Inn Worldwide, 02-0762

(La.App. 4 Cir. 5/15/02), 816 So.2d 998, writs

denied, 02-2116, 02-1875, 02-1906, 02-1983 (La.

10/14/02), 827 So.2d 408, 426, 427, 428, Vanessa

Williams filed suit for damages for injuries she

sustained as a security guard at the Holiday Inn

Crowne Plaza. Ms. Williams timely filed suit

against Holiday Inn Worldwide (later substituted as

Bristol Hotel Company). Over a year after the

alleged accident, Ms. Williams supplemented her

original petition to include as a defendant, among

others, Ernest Verges, an architect. Bristol/Holiday

Inn was dismissed with prejudice on the grounds that

it was Ms. Williams’ statutory employer. Mr.

Verges then filed an exception of prescription on the

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ground that Bristol/Holiday Inn was not solidarily

liable with him because it had been dismissed and,

therefore, prescription had not been interrupted. The

trial court denied the exception, and Mr. Verges filed

an application for writs. The fourth circuit

concluded:

As Bristol/Holiday Inn was dismissed with prejudice from the tort action, it is
not solidarily liable with Verges . . . . The plaintiff never filed an action for
workers compensation against Bristol/Holiday Inn or sought appellate review
of Bristol/Holiday Inn’s dismissal with prejudice. Therefore, plaintiff has no
other remedies against Bristol/Holiday Inn. Bristol/Holiday Inn is not, and will
not, be liable to plaintiff for any of her alleged damages. Therefore, the suit
against Bristol/Holiday Inn did not interrupt prescription as to Verges . . . .

Id. at 1001.

Likewise, in the instant case, as Load Right was dismissed with

prejudice from the tort suit as being the statutory

employer of Mr. Keller, it is not solidarily liable with

Hercules. Mr. Keller did not file an action for

workers’ compensation benefits against Load Right

and therefore has no other remedies against Load

Right. Load Right, therefore, is not liable to Mr.

Keller for any of his damages, and, as a result, the

suit against Load Right did not interrupt prescription

as to Hercules.

DISPOSITION

For the foregoing reasons, we affirm the judgment below and

assess one half of the costs of this appeal to William

M. Keller and one half of the cost of this appeal to

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Kenneth Parker Logging, Inc., Louisiana Safety

Association of Timbermen Self Insurer’s Fund,

Safety National Casualty Corporation, and Sedgwick

Claims Management Services, Inc.

AFFIRMED.

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