Claims arising out of injuries sustained at work are generally prosecuted in the Missouri Labor and Industrial Relations Commission (the “Commission”). However, it is not uncommon for an injured worker to elect to either file suit in circuit court or file in both venues. Missouri’s Workers’ Compensation Law (the “Act”) provides that if an injury comes within the definition of the term “accident” as defined in R.S.Mo. §287.020.2, then it is included within the exclusivity provisions of the Act, and recovery can be had, if at all, only under the terms set out in the Act. In other words, if an injury arising out of the course and scope of employment falls within the statutory definition of “accident”, any relief must be obtained through the Commission, to the exclusion of circuit court.

The Act’s exclusivity provision is set forth in R.S.Mo. §287.120.1, which provides that:

Every employer subject to the provisions of this chapter shall be liable, irrespective of negligence, to furnish compensation under the provisions of this chapter for personal injury or death of the employee by accident arising out of and in the course of the employee’s employment, and shall be released from all other liability therefore whatsoever, whether to the employee or any other person.

Beginning in the 1980’s, Missouri courts interpreted the Act’s exclusivity provision as a jurisdictional issue, meaning that the circuit courts lacked jurisdiction over the subject matter of the claim. Because circuit courts can only adjudicate issues over which they possess jurisdiction over the subject matter of the claim, a motion to dismiss for lack of subject matter jurisdiction may be raised at any time. That was the case in McCracken v. Wal-Mart Stores East, LP, 298 S.W.3d 473 (Mo. banc 2009), where Wal-Mart filed a motion to dismiss McCracken’s negligence claim on the morning trial was set to begin. Wal-Mart alleged McCracken was its statutory employee, therefore, the court lacked subject matter jurisdiction over McCracken claim.

The circuit court agreed, finding the exclusive jurisdiction of his claim was vested in the Commission. In reversing the circuit court, the Missouri Supreme Court overruled 30+ years of case law in holding that, “to the extent that some cases have held that a court has no jurisdiction to determine a matter over which it has subject matter and personal jurisdiction, those cases have confused the concept of a circuit court’s jurisdiction -- a matter determined under Missouri’s constitution -- with the separate issue of the circuit court’s statutory or common law authority to grant relief in a particular case.”

The Missouri Supreme Court concluded that the exclusivity provisions of the Act must be raised as an affirmative defense to the court’s statutory to proceed with resolving the claim, and the defense will be deemed waived if not asserted. Following publication of McCracken, the Missouri Court of Appeals – Western District issued its opinion in Fortenberry v. Buck, 307 S.W.3d 676 (Mo.App.W.D. 2010), in which the court noted the requirement of raising the exclusivity provision as an affirmative defense, and found that “a defendant, seeking a pre-trial dismissal based on workers’ compensation exclusivity, must file a motion for summary judgment.” The court further noted, however, that, “[w]hen the applicability of section 287.120 appears from the face of the petition, a defendant can also properly file a motion to dismiss for failure to state a claim upon which relief can be granted, see Rule 55.27(a)(6), or for judgment on the pleading pursuant to Rule 55.27(b) if the affirmative defense appears from the petition and other pleadings.”

Several appellate opinions have followed the procedural guidelines for asserting the exclusivity provision announced in Fortenberry. See, e.g., Treaster v. Betts, 324 S.W.3d 487 (W.D.Mo. 2010); Heirien v. Flowers, 343 S.W.3d 699 (Mo.App.S.D. 2011); Cooper v. Chrysler Group, LLC, 2011 Mo.App. LEXIS 1647 (Mo.App.E.D. Dec. 13, 2011).

The court in Cooper identified another alternative to the motion to dismiss/motion for summary judgment option. In Cooper, the injured worker first filed a claim with the Commission, and while that claim was pending, filed suit in circuit court. Chrysler Group raised the exclusivity provision of the Act as an affirmative defense and moved for summary judgment, in accord with Fortenberry, arguing that “plaintiff’s exclusive remedy for damages caused by injuries arising from a slip and fall on his employer’s premises was with the Commission.” The trial court agreed.

On appeal, the appellate court reversed and remanded with directions to stay the circuit court proceedings until the Commission determined whether there had been an “accidental injury” as defined by the Act. The court reasoned that the Commission retained primary jurisdiction to determine “questions includ[ing] determinations of whether there was an accident arising out of and in the course of employment and whether an employee’s injury resulted from an accident or an intentional act.” The court concluded that, “under the primary jurisdiction doctrine, the circuit court does not have the authority to determine the question of whether there was an “accidental injury” within the definitions of the Workers’ Compensation Law.”

The court notes that prior to McCracken, the exclusivity defense was permissibly raised as a motion to dismiss for lack of subject matter jurisdiction, but that dismissal on jurisdictional grounds “did not prevent a plaintiff from refiling his common law action and litigating it on the merits if the Commission subsequently determined that the plaintiff’s injury was not compensable under the Workers’ Compensation Law.” The court reasoned that since the exclusivity defense is based on the existence of accidental injury, which is an issue of fact to be determined by the Commission, it would be inappropriate for a court to enter summary judgment on the defense before the Commission decided the question of accidental injury, “because summary judgment would bar the refiling of the lawsuit if the Commission does not find an accidental injury.” As a result, the court found summary judgment to be premature, and remanded the case back to the circuit court with instructions to stay the proceedings until the Commission determines whether there was an “accident” as defined by the Act. Both parties in Cooper filed a motion for rehearing/transfer to the Missouri Supreme Court, and both motions were denied by the appellate court on January 23, 2012.

McCracken and its progeny make clear that a defense predicated on the exclusivity provision of the Missouri Workers’ Compensation Law is no longer considered a subject matter jurisdictional defect, but rather is an affirmative defense to the circuit court’s statutory authority to proceed. The defense must therefore be timely raised or it will be deemed waived. However, in light of Cooper, it remains uncertain whether circuit courts will be inclined to stay civil actions which are filed contemporaneously with or before a claimant seeks relief in the Commission.

 By:  Christopher Zarda

With better internet connections and better remote network access, working from home has become commonplace.   But a recent Missouri appellate decision may cause some employers to think twice about such an arrangement. 

In Tran v. Dave’s Electric, 2011 Mo.App.Lexis 1521, the Western District Court of Appeals ruled that an employer was liable for its employee’s negligent operation of her vehicle while driving to work.   The context of the case was a cross-over accident on an icy highway.  The Dave’s Electric employee was on her way to the office for an appointment with an auditor from the Company’s workers compensation carrier.                 

Under the “going and coming” rule, an employee is generally not considered in the course and scope of employment when driving to work.   Thus, employers are rarely held liable under respondeat superior for accidents like the one in Tran.  However, the Western District found that the “special errand” exception applied because the evidence at trial was that when the roads were bad, the Dave’s Electric employee typically worked from home.  An employee’s trip may qualify as a “special errand” when it is “…undertaken to serve the employer’s purposes, at a time and in a manner dictated by those purposes; the trip must not be a routine portion of the employee’s duties, and must subject the employee to special inconvenience, hazard, or urgency.” 

The Court’s decision in Tran clearly interprets the scope of the “special errand” exception broadly.  Missouri employees are frequently called upon to traverse icy and snowy roadways.  The decision also appears to ignore the realities of today’s workplace where employees may have some task that they are allowed to complete at home, but still have other task which they are required to complete at the Company’s place of business.   In the case of the latter tasks, it seems unfair to saddle the employer with potential liability simply because it is willing to allow its employees to complete the former tasks from the comfort of their own home.        

By: Kyle Roehler (kroehler@fwpclaw.com)

The U.S. Supreme Court’s recent holding inHosanna-Tabor Evangelical Lutheran Church and School v. Equal Employment Opportunity Commission and Cheryl Perich, is both a win for religious freedom and a blow to workplace equality.  No. 10-553, 565 U.S. ____ (January 11, 2012), available athttp://www.supremecourt.gov/opinions/11pdf/10-553.pdf.  For the first time, the Court recognized a “ministerial exception” that bars employment discrimination suits by “ministerial” employees of religious groups.  Id. at *13.  The exception is meant to protect religious groups from government interference in the selection of their ministers.  Id. at *10.    Unfortunately for religious groups and their employees alike, the Court’s opinion only partially explains the contours of the “ministerial exception,” leaving uncertainty about which employees of religious groups are protected by federal and state employment discrimination laws, and which are not.

The case arises out of an employment dispute at the Hosanna-Tabor Evangelical Lutheran Church and School (“Hosanna-Tabor”).  Hosanna-Tabor operates a religious elementary school, where it employs both “lay” and “called” teachers.  Id. at *2.  While “lay” teachers need not even be Lutheran, id. at *2, “called” teachers carry the title “Minister of Religion, Commissioned,” because they have completed “a significant degree of religious training followed by a formal process of commissioning.”  Id. at *16.  Both types of teachers “generally performed the same duties,” including the teaching of religious subjects; however, “lay teachers were hired only when called teachers were unavailable.”  Id. at *2. 

Hosanna-Tabor employed Cheryl Perich as a “called” teacher for more than four years.  Id.at *2-3.    In the summer of 2004, Perich developed narcolepsy, resulting in her taking disability leave for the first part of the 2004-2005 school year.  Id.at *3.  On January 27, 2005, Perich notified the school principal of her intention to return to work on February 22, as authorized by her doctor.  Id.at *3.  Hosanna-Tabor responded by asking Perich to resign, concluding “that Perich was unlikely to be physically capable of returning to work that school year or the next.”  Id.at *3.  Perich refused to resign and instead showed up for work on February 22, causing a disturbance by initially refusing to leave.  Id.at *3.  Perich also informed the school principal “that she had spoken with an attorney and intended to assert her legal rights.”  Id.at *3.  Hosanna-Tabor then fired Perich, citing her “insubordination and disruptive behavior” and her “threat[] to take legal action.”  Id. at *4.

Perich followed through with her threat to take legal action.  After Perich filed a Charge of Discrimination with the Equal Employment Opportunity Commission (“EEOC”), “[t]he EEOC brought suit against Hosanna-Tabor, alleging that Perich had been fired in retaliation for threatening to file an ADA lawsuit.”  Id. at *5 (referencing the Americans with Disabilities Act, 42 U.S.C. § 12101 et seq.).  Perich intervened in the action, adding a retaliation claim under the Michigan Persons with Disabilities Civil Rights Act, Mich. Comp. Laws § 37.1602(a).  Id. at *5.  The District Court dismissed the claims on summary judgment, citing the “ministerial exception”; however, the Court of Appeals for the Sixth Circuit reversed, saying that the exception did not apply.  Id.at *5-6.  Thereafter, the U.S. Supreme Court granted certiorari.  Id. at *6.

The Court first considered whether the “ministerial exception” exists.    It noted that “the Courts of Appeals have uniformly recognized the existence of a ‘ministerial exception,’ grounded in the First Amendment, that precludes application of [employment discrimination laws] to claims concerning the employment relationship between a religious institution and its ministers.”  Id. at 13.  The Court agreed:

Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs. By imposing an unwanted minister, the state infringes the Free Exercise Clause, which protects a religious group’s right to shape its own faith and mission through its appointments. According the state the power to determine which individuals will minister to the faithful also violates the Establishment Clause, which prohibits government involvement in such ecclesiastical decisions.

Id. at 12-13.  The Court also noted that its prior decisions “confirm that it is impermissible for the government to contradict a church’s determination of who can act as its ministers.”  Id. at *10.  Accordingly, the Court held that a “ministerial exception” to employment discrimination laws exists.  Id. at 13.

The Court next considered whether Perich fell within the “ministerial exception.”  The unanimous Court was “reluctant . . . to adopt a rigid formula for deciding when an employee qualifies as a minister[,]” but held “that the [ministerial] exception covers Perich, given all the circumstances of her employment.”  Id.at *15-16.  In particular, the Court cited “the formal title given Perich by the Church, the substance reflected in that title, her own use of that title, and the important religious functions she performed for the Church” in concluding that the ministerial exception applied.  Id.at *18.  Regarding the facts that “lay teachers at the school performed the same religious duties as Perich” and that “her religious duties consumed only 45 minutes of each working day,” the Court held that such facts are relevant to the analysis but not dispositive.  Id. at *18-19.  For these reasons, the Court reversed the decision of the Sixth Circuit, reinstating the District Court’s dismissal of Perich’s disability retaliation claims under the “ministerial exception.”  Id. at *22.

In a footnote to the opinion, the Court also settled a circuit split on the procedure for raising the “ministerial exception.”  “We conclude that the exception operates as an affirmative defense to an otherwise cognizable claim, not a jurisdictional bar.”  Id. at *20 n.4.  Thus, religious groups who are sued by an employee for employment discrimination must raise the “ministerial exception” at the earliest opportunity (typically in the Answer), or else it may be waived.

The Court’s decision in Hosanna-Tabor is both a win for religious freedom and a blow to workplace equality.  Addressing the tension between these two worthy objectives, the Court said:

The interest of society in the enforcement of employment discrimination statutes is undoubtedly important.  But so too is the interest of religious groups in choosing who will preach their beliefs, teach their faith, and carry out their mission.  When a minister who has been fired sues her church alleging that her termination was discriminatory, the First Amendment has struck the balance for us.  The church must be free to choose those who will guide it on its way.

Id. at *21-22.  Put another way, the First Amendment protects a religious group’s freedom to discriminate against “ministerial” employees, not just on the basis of religion, but also on the basis of race, color, national origin, sex, ancestry, age, disability, pregnancy, and other protected characteristics.  The tragedy of this decision for workplace equality is that the Court declined to clearly articulate a test for determining when the “ministerial exception” will apply.  This means uncertainty for all employees of religious groups, as well as their employers, who can only speculate about which employees of religious groups enjoy the protections of federal and state employment discrimination laws.   Unfortunately, the answer to this question must wait until the U.S. Supreme Court has another occasion to consider the “ministerial exception.” 

By: Luke R. Hertenstein

Negligence Claims in Kansas Home Construction Cases Kansas Supreme Court Finds Economic Loss Doctrine Inapplicable to Home Construction Cases

 In David v. Hett, the Kansas Supreme Court held that the economic loss doctrine should not preclude claims by homeowners seeking to recover economic damages resulting from negligently performed residential construction services.  In reaching this holding, the David Court overturned the Kansas Court of Appeals’ 2004 decision, which had previously barred such negligence claims.   

The case arose from a claim for negligent workmanship brought by the Appellants, Scott and Sherry David, who had acted as their own general contractor in the construction of their home.  In the course of this venture, the Davids hired David Hett d/b/a Hett Construction to excavate and lay the foundation for their new home.  Hett’s bid was orally accepted by the Davids and then orally modified at a later date; there was some dispute regarding the terms of the modification.  Regardless, the Davids accepted Hett’s finished work in 1998.  In 2003, the Davids’ home began experiencing unusual settling, and in 2005 the Davids sued Hett for breach of contract, negligence, fraud, fraudulent concealment, and violation of the Kansas Consumer Protection Act.  Seeking damages to bring the house into compliance with the original plans, the Davids alleged that Hett had negligently performed the contractually required work.  The sole issue on appeal was whether the economic loss doctrine barred the Davids’ negligence claims.

As noted in David, the economic loss doctrine is “a judicially created doctrine that sets forth the circumstances under which a tort action is prohibited if the only damages suffered are economic losses.”  (internal citations omitted).  The rationale for the doctrine, which arises out of product liability law, is that a manufacturer is tasked with guarding against dangerous products, but cannot be expected to protect against a product not meeting a consumer’s expectations.  The Supreme Court of the United States previously approved the practicality of the economic loss doctrine by offering the following justifications:  1) the damage to a product is substantially less than that of personal injury; 2) warranty and contract law were better positioned to handle commercial disputes; and 3) allowing negligence theories exposed the manufacturers to an unlimited number of claimants who might not have privity with the manufacturer. 

The Kansas Supreme Court previously identified situations where the law imposed a duty irrespective of the existence of a contract.  In such instances any negligence actually arises out of the breach of the actual or implied duty, rather than under the terms of a contract.  In applying this theory in the context of medical malpractice claims, the Kansas Supreme Court held that “an injury is remediable in tort if it traces back to the breach of tort duty arising independently of the terms of the contract.”  (internal citations omitted). 

The Kansas Court of Appeals had been the highest court in Kansas to consider whether the economic loss doctrine should apply in negligent home construction claims in Prendiville v. Contemporary Homes, Inc.  The Court of Appeals reasoned that the plaintiff’s claims were governed by contract and warranty, and therefore were more properly disposed under those areas of the law.  Accordingly, the court decided that any claims for negligent home construction were barred by the economic loss doctrine. 

The Kansas Supreme Court overruled Prendiville because it found that a contractor has a duty to perform their obligations in a workmanlike manner and exercise reasonable care in the course of such performance.  As a foundation for this point, the Court demonstrated that the workmanlike manner and reasonable care standards were widely recognized in Kansas case law.  The David Court found this result equitable because service contracts are not armed with the warranty protections afforded goods under the Kansas Uniform Commercial Code.  As further rationale for this holding, the Court demonstrated that the home buyer, who is typically not in the same bargaining position as the contractor, should be afforded additional protections.  Lastly, the Court felt that the application of the economic loss doctrine could potentially expose two contractors to different results of liability on the basis of when the damage was discovered. 

As it was unclear from the record whether the Davids had sufficiently plead an alleged breach of duty, the Court remanded the case for that determination. 

 By: Mike Meyer, Associate

 The deceased’s next of kin brought a law suit alleging that the defendants (local businessmen) negligently entrusted a motor vehicle to the deceased because they allegedly should have known he was an alcoholic.  The deceased was killed in a one car accident. 

Joe Roper and Mike Belancio filed a motion to dismiss the law suit.  In what the trial court recognized was an issue of first impression in Missouri, the Firm demonstrated that there was no duty for the defendants to protect the deceased from injuries inflicted on himself, as opposed to third parties.

The Missouri Dram Shop Act already precludes suits by the consumers of alcohol for their own self-imposed injuries after they are served alcohol.  Thus, with even greater certainty, the Firm argued there should be preclusion of law suits by the consumers of alcohol for injuries sustained based on provision of a vehicle.

Plaintiff made a pre-suit demand of $3.75 million...