Tort Liability For Owners: When May An Owner Be Liable For Injuries To Employees Of Its Contractors?

Tort Liability For Owners: When May An Owner Be Liable For Injuries To Employees Of Its Contractors?

A recent U.S. Fifth Circuit Court of Appeals decision applying Louisiana law, Renwick v. PNK Lake Charles, L.L.C., 901 F.3d 605 (5th Cir. 2018), offers valuable insight regarding how an owner may become liable in personal injury claims brought by a subcontractor’s employee on a construction project. Under Louisiana law, a premises owner is generally not liable for damages caused by the actions of an independent contractor, but there are important exceptions when an owner 1) exercises operational control over the contractor’s actions, or 2) expressly or impliedly authorizes an unsafe practice. It is important for contractors and owners to understand how courts applying Louisiana law have interpreted these terms, and Renwick offers useful guidance on these issues.

I.     What Happened in Renwick?

The plaintiff, Tyler Renwick (“Renwick” or “plaintiff”) was injured when he fell from a defective ladder that spanned a narrow gap between a casino vessel and a hotel, both owned by PNK Lake Charles LLC (“PNK” or “owner”). The plaintiff was an employee of a subcontractor that was hired to clean ventilation equipment on the hotel roof. Following his accident, the plaintiff sued the owner and claimed it was liable for his injuries and damages.

The owner’s premises consisted of a floating casino vessel next to a hotel. The ventilation equipment plaintiff was attempting to access was located inside the hotel kitchen and on the hotel’s roof and side. The owner controlled the access to the premises and instructed the subcontractor regarding how it would access the work area on the roof. The employees were instructed to proceed up to the adjacent casino’s roof, situated about 10 feet below the hotel roof, and climb a ladder that leaning against the hotel. The ladder spanned a two or three foot gap between the casino and hotel, with a considerable drop (about 50 feet according to some estimates) to a gangway below. The owner specified that ladder access from the casino roof was the only way to reach the vents, and did not disclose any alternate access points.

The contractors were dissatisfied with the access arrangement, and proposed that the owner construct a purportedly safer platform access to the roof. The contractors also presented the owner with proposed designs for the platform, but the owner reportedly rejected the proposal over budget concerns. The contractor’s employees, including the plaintiff, accessed the casino roof via the ladder for the duration of the “years-long course” of the work. The owner reportedly did not supervise the employees’ day-to-day work. Following the accident, the owner began allowing the contractors access to the roof through the hotel interior, which appeared to be a safer method of reaching the roof. The owner reportedly did not offer this access point as an option prior to the accident.

The plaintiff was injured while ascending the ladder. It consisted of only one-half of an extension ladder, and lacked stabilizing feet. As a result, the ladder reportedly slipped out from under the plaintiff before he reached the hotel roof. The parties agreed that the ladder in question was defective and unsafe, but it is unclear who provided or set up the ladder.

II.      Potential Liability for Premises Owners

In short, the question posed in Renwick was whether, under these facts viewed in a light most favorable to the plaintiff due to the pre-trial procedural posture of the case, the owner could potentially be found liable for the plaintiff’s injuries at trial. The appellate court was tasked with determining whether the facts presented were enough for the trier of fact to potentially find the owner liable.

While a premises owner is typically not liable for an independent contractor’s negligence, this general rule is subject to two exceptions: 1) if the owner exercises “operational control” over the contractor’s actions; or 2) if the owner “expressly or impliedly authorizes an unsafe practice.”

     a.      “Operational Control”

Louisiana courts have explained that operational control exists only if the principal (the owner) has direct supervision over the step-by-step process of accomplishing the work, such that the contractor is not entirely free to do the work in his own way. It is not enough that the principal has merely a general right to order the work to be stopped or resumed, to inspect its progress, to receive reports, to make suggestions or recommendations which need not necessarily be followed, or to prescribe alterations or deviations. Periodic inspections by an owner’s representative do not result in the owner retaining operational control. The owner must have control over the operative details of doing any part of the work, such that the contractor is not entirely free to do the work in his own way.

The trial court ruled that the owner lacked any “operational control” over the contractor’s work. It found that the owner’s recommendations for how to access the roof were “non-binding”; there were no “discussions” about providing access ladders; the owner was unaware of any specific ladders on the roof; and, the contractors were responsible for selecting the reportedly defective ladder used.

The appellate court disagreed. The owner’s facilities director reportedly testified that the owner controlled the access to the hotel and casino premises, including the roof. Additional owner representatives testified that the owner identified where the contractor’s employees and how they would access the roof. The appellate court found it important that the contractor objected to the access method, proposed an alternative design, which was then rejected by the owner because of budgetary concerns. The appellate court also found it important that the owner initially told the contractor that the ladder access was the “only” way to access the roof, but it began to allow the employees to access the roof through the interior of the hotel after the accident, likely a much safer method.

The appellate court took great care to confirm that a fact finder could ultimately reach a different conclusion at trial on the operational control issue. It simply confirmed the owner could possibly be liable as a matter of law under the facts presented.

     b.     “Expressly or Impliedly Authorizing an Unsafe Practice”

If work is performed in an unsafe manner, the owner may be found liable if it expressly or impliedly authorized the particular manner that rendered the work unsafe. The trial court found the owner had not expressly or impliedly authorized the unsafe practice, for the same reasons cited above. The appellate court disagreed, and pointed to evidence showing the owner directed the employees to access the roof in a way that could be determined to be unsafe. The owner also reportedly directed the specific means of access, and reportedly concealed a safer alternative access point through the hotel interior.
When evaluating whether the practice was in fact “unsafe,” the appellate court was not persuaded by the fact that employees had been accessing the roof via the ladder for “years”, presumably without issue. The appellate court again took great care to confirm that a fact finder could ultimately reach a different conclusion at trial on this issue, but also confirmed that the owner could possibly be liable as a matter of law.

III.     The Impact of Renwick on an Owner’s Potential Tort Liability

The takeaway from Renwick is that a premises owner on a construction project may be found liable for injuries sustained by employees of its contractors if it controls the way the contractor does its work or authorizes practices that are unsafe. The devil is in the details and in documentation, and the courts appear to focus is on employee safety above efficiency and costs. The weight of evidence is likely to win the day in the event such claims are litigated. Owners would do well to take direction from and work in conjunction with its contractors regarding employee safety. Owners also should not ignore safety issues they become aware of, and should avoid directing a contractor to perform the work a certain way when a safer alternative is known. Evidence of a contractor presenting an owner with a safer method, only to have that method denied by the owner because of costs, may increase the potential for an owner to be found liability. Both would likely benefit from ongoing communication regarding safety concerns and from documenting conversations when potential safety recommendations were addressed.