Kelly v. Kraemer Construction, Inc.

Kelly v. Kraemer Construction, Inc., Supreme Court Case No. A15-1751 (June 7, 2017).

General contractor, Ulland Brothers (Ulland), won a bid to repair two bridges and subcontracted Kraemer Construction (Kraemer) to provide the necessary crane work. Kraemer provided the crane and two crew members – a crane operator and a signalman/oiler. Richard Washburn was working at the construction site for Ulland and was manually guiding a concrete box culvert section as it was lowered by the crane operator from Kraemer. When Washburn grabbed the culvert section as it was being lowered, he was electrocuted and died. Washburn’s survivors received workers’ compensation benefits from Ulland. Jessica Kelly is the mother of Washburn’s children and was appointed trustee for Washburn’s children to sue Kraemer for negligence in causing Washburn’s death.

Kraemer moved for summary judgement and argued that it was engaged in a common enterprise with Ulland when Washburn was killed and thus, the election-of-remedies provision of the Minnesota Workers’ Compensation Act prevents a civil action against Kraemer when the children of the deceased had already received workers’ compensation benefits from Ulland. The three requirements for a common enterprise defense include: 1) the employers must be engaged on the same project; 2) the employees must be working together in a common activity; and 3) the employees must be working in such a fashion that they are subject to the same or similar hazards. Kraemer did concede that the first requirement was met

The district court found that the duties of Kraemer employees were very different and separate from the duties of Ulland employees and that the risks associated for employees of Kraemer versus Ulland were “for the most part distinct.” Thus, the district court denied the summary judgement motion.

The court of appeals, however, reversed. The court of appeals noted that the two crews could not have accomplished the project by working separately and thus the common activity requirement was met. The court also indicated that Kraemer offered the only expert evidence regarding general risks and established that the two crews were subject to “similar, if not identical, hazards…”

The Supreme Court affirmed the court of appeals decision to grant summary judgement. Regarding the first factor, the Supreme Court determined that the two crews’ work was “interdependent” and the Kraemer crew relied on the Ulland crew and vice versa, and thus, they were working together in a common activity. The argument was raised that one of the Kraemer crew members who was helping guide the culvert into place when Washburn was electrocuted was acting outside the scope of his actual job duties and was doing so on a volunteer basis. The Supreme Court determined that a favor or accommodation such as that doesn’t change this analysis, because regardless of whether he was outside the scope of his official role or doing a “favor” for the other crew members, the overall goal of the job could not have been accomplished without both the crew from Kraemer and the crew from Ulland. The Supreme Court focused on the fact that the workers from both crews had to coordinate their jobs throughout the entire day to complete the work.

Regarding the requirement that both crews be subject to the same or similar risks, the Supreme Court affirmed that they must look at the general risk associated with the work being performed and not the specific hazard that resulted in the injury. The Supreme Court noted that Kraemer presented expert testimony regarding the risks of that job site and that expert testified that the Kraemer crew and the Ulland crew faced the same risks. Kelly’s expert witness did not testify about the general risks present at that job site, but did testify that electrocution except by contact with a powerline was mathematically implausible. Based on that, the Supreme Court found there was a genuine issue of material fact as to whether electric shock was a shared risk, but there was no doubt that there were several other shared risks and that is enough for this requirement to be satisfied.

Justice McKeig dissented and Justice Lillehaug joined that dissent.