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Illinois Supreme Court Weighs in on General Contractor Liability for Construction Negligence Claims
December 2016
The Illinois Supreme Court recently weighed in on three separate theories of liability frequently invoked in construction-related personal injury cases. In Carney v. Union Pacific Railroad Company, 2016 IL 118984, Happ's, a scrap contractor, entered into a contract with Union Pacific to purchase and remove three abandoned railroad bridges. The plaintiff was severely injured when a steel girder fell during the dismantling of one of the bridges. The plaintiff, an employee of Chicago Explosive Services, filed suit against Union Pacific alleging Union Pacific: 1) retained control over the work of Happ's and failed to properly supervise the work; 2) was negligent in hiring Happ's; and 3) failed to warn plaintiff of a dangerous condition on its land.
The opinion includes an important discussion of liability under Restatement (Second) of Torts §414, under which a hiring entity - such as a general contractor - may be subject to liability for work entrusted to an independent contractor where it retains control over the independent contractor's work. Illinois courts analyzing §414 have described both "direct liability" and "vicarious liability." Direct liability relates to the retention of general supervisory control and the failure to exercise that control with reasonable care to prevent work from causing injury to others. The hiring entity could also be subject to vicarious liability for the negligence of the independent contractor if it controlled the operative details of the work.
Illinois Supreme Court Finds Law Reducing Size of Civil Juries From 12 to 6 Unconstitutional
October 2016
In an opinion filed on September 22, 2016 in the case of Kakos v. Butler, 2016 IL 120377, the Supreme Court of Illinois (the "court") held Public Act 98-1132 was facially unconstitutional.
Public Act 98-1132 (the "Act") was enacted in December 2014 and took effect on June 1, 2015. The Act limited the size of a civil jury to 6 persons and increased the amount paid per day to jurors across the state. The Act was generally believed to be favorable to the plaintiffs' bar because smaller juries may tend to award more money damages.
In the trial court, defendants in a medical malpractice suit sought leave to file a 12-person jury demand and to have the Act declared unconstitutional. Cook County Judge Gomolinski ruled the provision reducing the jury size from 12 to 6 was facially unconstitutional based on article I, section 13, of the Illinois Constitution, which protects the right of trial by jury.
New Regulation on Employee Overtime Exemption
September 2016
On May 18, 2016, the U.S. Department of Labor - Wage and Hour Division announced the much anticipated Final Rule revising the overtime exemption for "white collar" employees under the Fair Labor Standards Act (FLSA). Under the FLSA, non-exempt employees are entitled to overtime pay (time and one-half) for working over 40 hours in one week. The "white collar" overtime exemption generally applies to executive, administrative, and professional employees: 1) paid on a salary basis, not less than the amount specified in the regulations; and 2) whose primary job duties satisfy certain minimum requirements set for the regulations. See 29 C.F.R. §541. The Final Rule did not amend the regulations concerning the job duties prong of the exemption, but significantly increased the minimum salary requirements.
The new regulations, which take effect December 1, 2016, increase the minimum salary basis to $913 a week or $47,476 annually. Since 2004, the salary basis for the "white collar" overtime exemption was $455 a week or $23,660 annually. This significant increase is in part due to the passage of time with no adjustment to the minimum salary. Under the new law, the salary basis will be adjusted every three years starting on January 1, 2020. The new regulations will also, for the first time, allow employers to use up to 10% of non-discretionary bonuses, incentive payments and commissions (if paid at least every quarter) to satisfy the minimum salary required for the exemption.
Country Mutual Insurance Company V. Charles Dahms, 12 CH 43692
September 2016
The Appellate Court for the First District in the above captioned matter held Country Mutual Insurance Company ("Country Mutual") had a duty to defend its insured, Charles Dahms, ("Dahms") in a civil suit filed by Terry Enadeghe, ("Enadeghe") wherein Enadeghe pleaded causes of action for negligence and battery stemming from an altercation which occurred on October 10, 2011. Enadeghe pulled his taxi up to a crosswalk near Dahms. Dahms' briefcase made contact with the windshield of the taxi. Enadeghe left his taxi and pursued Dahms on foot, a scuffle ensued, and Dahms struck Enadeghe with his briefcase.
The trial court found Country Mutual had a duty to defend Dahms because Dahms had filed an affirmative defense of self defense in the civil case. The trial court found the duty to defend arose the day Dahms filed his answer and affirmative defenses.
The Appellate Court held Country Mutual owed a duty to defend Dahms in the tort action and that duty arose the moment the tort lawsuit was filed and not on the date Dahms filed his affirmative defenses. The Appellate Court further held Country Mutual's duty to defend terminated on the date Dahms was convicted of aggravated battery as his conduct fit within the policy's criminal acts exclusion.
Forty-One Years After Exposure, Illinois Supreme Court Finds Mesothelioma Claim Is Barred By The Exclusive Remedy Provision
March 2016
By Molly P. Connors
In a recent case, Folta v. Ferro Engineering, 2015 IL 118070, the Illinois Supreme Court held that an employee's lawsuit against his employer was barred by the exclusive remedy provisions of the Workers' Compensation Act and the Workers' Occupational Diseases Act, even when he was diagnosed with an occupational disease after the statute of repose in the Workers' Occupational Diseases Act had run. The plaintiff alleged he was exposed to products containing asbestos during the four-year period he worked for the defendant, from 1966 to 1970. Forty-one years later, the plaintiff was diagnosed with mesothelioma; one month later, he filed a complaint against Ferro Engineering ("Ferro") and 14 other defendants, seeking damages stemming from the asbestos exposure he experienced while working at Ferro.
Ferro filed a motion to dismiss the plaintiff's complaint, arguing that his claims were barred by the exclusive remedy provisions of the Workers' Compensation Act and the Workers' Occupational Diseases Act. In response, the plaintiff asserted that because his symptoms did not manifest until after the 25-year limitation period in the Workers' Occupational Diseases Act had expired, his claims were not compensable under the acts. Therefore, he concluded, the acts' exclusive remedy provisions did not apply. The circuit court granted Ferro's motion to dismiss. The appellate court reversed, finding that the exclusive remedy provisions do not apply when the employee's claim is not compensable, and the plaintiff's claim was not compensable because he did not have an opportunity to pursue his claim before the expiration of the statute of repose.
Appellate Court Affirms Summary Judgment In Favor Of City Of Chicago And Contractors In Construction Negligence Suit
March 2016
A recent decision from the First District Appellate Court, Cabrera v. ESI Consultants, Ltd., 2015 IL App (1st) 140933, addresses several noteworthy issues which can arise in construction negligence lawsuits. The decision discusses a municipality's tort immunity, contractor liability under Restatement (Second) of Torts §414 and the proper scope of expert opinions. The Appellate Court affirmed summary judgment on behalf of all defendants.
The plaintiff was injured while working at a construction project on the Washington Street Bridge in the City of Chicago. His employer, Valdivia Contractors, was hired by the City of Chicago to perform certain work including sandblasting and painting the bridge. The plaintiff alleged the City of Chicago had a presence on the project, controlled the work, and had authority over means and methods and jobsite safety. A civil engineer for the City of Chicago, testified his duties included construction management, supervising a construction consultant and the various contractors.
The trial court granted summary judgment to the City of Chicago holding it was entitled to absolute immunity under Section 2-201 of the Illinois Tort Immunity Act which grants immunity to municipalities against liability for discretionary decisions.
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