Galue v. Clopay Corp.

388 So.3d 64

Fernando GALUE, Appellant,

v.CLOPAY CORPORATION, et al., Appellees.

No. 3D22-661

District Court of Appeal of Florida, Third District.

Opinion Filed August 30, 2023

An Appeal from the Circuit Court for Miami-Dade County, Antonio Arzola, Judge. Lower Tribunal No. 20-16688

Leeder Law and Thomas H. Leeder and Andrew R. Smith (Plantation); Burlington & Rockenbach, P.A., and Jeffrey V. Mansell (West Palm Beach), for appellant.

Clyde & Co US LLP and Frederick J. Fein and Clayton W. Thornton, for appellees.

Vaka Law Group, P.L., and George A. Vaka and Robert C. Hubbard (Tampa), for Florida Justice Association, as amicus curiae.

Before FERNANDEZ, HENDON and LOBREE, JJ.

LOBREE, J.

Fernando Galue appeals from a final judgment entered in favor of Clopay Corporation ("Clopay") and Anthony Julian on each’s affirmative defense that Clopay was Galue’s statutory employer under section 440.10(1)(b), Florida Statutes (2022), and therefore entitled to statutory employer immunity from Galue’s personal injury claim. We find that the sole contractual clause relied upon by Clopay in moving for summary judgment did not oblige it to perform a job or provide a service for a third party (i.e., Clopay’s landlord). Therefore, we conclude that when Clopay hired Galue’s employer to conduct a fire inspection of its premises it did not sublet "part or parts" of its "contract work to a subcontractor," such that Clopay obtained statutory employer status under section 440.10(1)(b). Accordingly, we reverse the summary judgment entered in favor of Clopay and Julian and remand for further proceedings.

BACKGROUND

Clopay entered into a lease with KTR SF II LLC for the rental of a portion of a building located in Doral, Florida (the "premises"), which Clopay used as a storage facility for its products. During its tenancy, Clopay hired Florida Fire Safety ("FFS") to conduct an inspection of the premises, including the exit and emergency lights. Galue was a technician for FFS, and he was assigned to do the inspection at Clopay. While conducting the inspection, Galue noticed that an exit light located behind some pallets needed to be changed. Galue asked Julian, a Clopay employee, to move the pallets so that he could change the light. Julian told Galue to stand back, and started moving the pallets with a forklift. Then, Galue heard a loud noise, and pallets and boxes fell on him. Galue received worker’s compensation benefits for his injuries from FFS’ worker’s compensation carrier.

Galue then brought an action in state court against Clopay and Julian for the injuries he sustained in the forklift inci- dent. Galue alleged claims for negligence against both Clopay and Julian, and vicarious liability against Clopay. Clopay and Julian each answered and raised worker’s compensation immunity as an affirmative defense.

Clopay moved for summary judgment asserting that Galue’s action was barred by worker’s compensation immunity. Specifically, Clopay argued that a clause in paragraph 4 of its lease with KTR SF II, requiring it to "use the Premises in compliance with all federal, state, local, and municipal laws, orders, judgments, ordinances, regulations, codes, directives, permits, licenses, covenants and restrictions … applicable to the Premises (collectively, ‘Legal Requirements’)," meant that it had a contractual obligation to KTR SF II to ensure that fire safety equipment was operational. Clopay asserted that it then delegated its contractual obligation to KTR SF II to Galue’s employer, FFS. As a result, Clopay was a "statutory employer" of a subcontractor, FFS, and was therefore immune from liability via the "vertical immunity" set forth in section 440.10(1)(b). Galue opposed Clopay’s summary judgment motion, arguing in part that the lease’s requirement that Clopay use the premises in compliance with the law was not a service it performed for KTR SF II. Therefore, Clopay was not a "contractor" who sublet "contract work" under section 440.10(1)(b).

The trial court granted summary judgment in favor of Clopay. Relying solely on the lease’s requirement that Clopay "use the Premises in compliance with all federal, state, local, and municipal laws, orders, judgments, ordinances, regulations, codes, directives, permits, licenses, covenants and restrictions … applicable to the Premises," the trial court found that Clopay "delegated/sublet its contractual obligation [under the lease] to comply with fire safety laws" to FFS. Galue, in turn, was injured "while performing these fire safety services" as an employee of FFS. Thus, the trial court concluded that Clopay was entitled to worker’s compensation immunity as Galue’s statutory employer under sections 440.10(1)(b) and 440.11(1), Florida Statutes. Galue, Clopay, and Julian filed a joint stipulation that the order granting final judgment in favor of Clopay would apply equally to Julian. Thereafter, the trial court entered final judgment against Galue on his claims against both Clopay and Julian. This appeal followed.

STANDARD OF REVIEW

[1] A trial court’s final summary judgment in favor of a defendant claiming worker’s compensation immunity is reviewed de novo. See Heredia v. John Beach & Assocs., Inc., 278 So. 3d 194, 196 (Fla. 2d DCA 2019); Slora v. Sun ‘n Fun Fly-In, Inc., 173 So. 3d 1099, 1101 (Fla. 2d DCA 2015).

ANALYSIS

[2] Under section 440.10(1)(b), a defendant is entitled to worker’s compensation immunity as an injured worker’s "statutory employer if it is considered a ‘contractor’ that ‘sublet[ ] any part’ of its ‘contract work’ " to the injured worker’s employer. Tampa Elec. Co. v. Gansner, 327 So. 3d 1281, 1284 (Fla. 2d DCA 2021) (quoting § 440.10(1)(b), Fla. Stat.). That subdivision provides as follows:

(b) In case a contractor sublets any part or parts of his or her contract work to a subcontractor or subcontractors, all of the employees of such contractor and subcontractor or subcontractors engaged on such contract work shall be deemed to be employed in one and the same business or establishment, and the contractor shall be liable for, and shall secure, the payment of compensation to all such employees, except to employees of a subcontractor who has secured such payment.

§ 440.10(1)(b). "[T]he purpose of section 440.10 … [is] ‘to insure [sic] that a particular industry will be financially responsible for injuries to those employees working in it, even though the prime contractor employs an independent contractor to perform part or all of its contractual undertaking.’ " Gator Freightways, Inc. v. Roberts, 550 So. 2d 1117, 1119 (Fla. 1989) (quoting Roberts v. Gator Freightways, Inc., 538 So. 2d 55, 60 (Fla. 1st DCA 1989)); see also Crum Servs. v. Lopez, 975 So. 2d 1184, 1186 (Fla. 1st DCA 2008) (explaining that section 440.10(1)(b) "is designed to ensure that employees engaged in the same contract work are covered by workers’ compensation, regardless of whether they are employees of the general contractor or its subcontractor").

[3] To be considered a "contractor" under section 440.10(1)(b), an entity must "show that it ‘incurred a contractual obligation to a third party.’ "¹ Slora, 173 So. 3d at 1101; see also Rabon v. Inn of Lake City, Inc., 693 So. 2d 1126, 1130 (Fla. 1st DCA 1997) ("[W]e read the language of section 440.10(1)(b) as an expression of legislative intent that the sublet work must be an obligation included within a promissory agreement between the contractor and a third party."); Bal Harbour Tower Condo. Ass’n, v. Bellorin, 351 So. 3d 96, 99 (Fla. 3d DCA 2022). That contractual obligation to a third party must in turn be sublet to a subcontractor. See Rabon, 693 So. 2d at 1131 (stating that section 440.10(1)(b) "is expressly limited to circumstances in which a contractor sublets performance of a contractual obligation that it owes to a third party"); Woods v. Carpet Restorations, Inc., 611 So. 2d 1303, 1304 (Fla. 4th DCA 1992) ("It is absolutely basic, therefore, that one cannot be a ‘contractor’ (and thus a statutory employer) within the meaning of this statute unless the ‘contractor’ has a contractual obligation, a portion of which is sublet to another.").

[4] On appeal, Galue argues that Clopay was not a "contractor" for worker’s compensation purposes because Clopay did not have a contractual obligation to perform work, services, or a job that arose out of its lease with KTR SF II. Specifically, Galue contends that Clopay’s obligation under the lease to "use the Premises in compliance with all federal, state, local, and municipal laws, orders, judgments, ordinances, regulations, codes, directives, permits, licenses, covenants and restrictions … applicable to the Premises," did not require it to provide fire safety services to KTR SF II, much less to maintain and repair fire safety equipment. We find that Galue’s argument has merit.

[5] The fact that a defendant has a contractual obligation to a third party alone does not give that defendant tort immunity as a "contractor" under section 440.10(1)(b). Instead, Florida courts have consistently characterized the contractual obligation, or "contract work," to which section 440.10(1)(b) refers as an obligation on the part of the defendant to perform a job or provide a service. See Gator Freightways, Inc., 550 So. 2d at 1119 ("Roberts recognized that, for a company to be a contractor under this section, its primary obligation in performing a job or providing a service must arise out of a contract."); Tampa Elec. Co., 327 So. 3d at 1284 ("To be considered a contractor under section 440.10, Tampa Electric’s ‘primary obligation in performing a job or providing a service must arise out of a contract.’ " (quoting Sotomayor v. Huntington Broward Assocs. L.P., 697 So. 2d 1006, 1007 (Fla. 4th DCA 1997)); Slora, 173 So. 3d at 1102 ("Thus, to be immune from tort liability as a contractor, a defendant’s "primary obligation in performing a job or providing a service must arise out of a contract." (quoting Derogatis v. Fawcett Mem’l Hosp., ...