Marie Guess, as Trustee for the Heirs and Next of Kin of Michael L. Guess, Appellant, vs. Mark Priore, Special Administrator for the Estate of Richard E. Conry, deceased, Defendant, Aviation Charter, Inc., et al., Respondents.

Marie Guess, as Trustee for the Heirs and Next of Kin of Michael L. Guess, Appellant, vs. Mark Priore, Special Administrator for the Estate of Richard E. Conry, deceased, Defendant, Aviation Charter, Inc., et al., Respondents. A05-2467, Court of Appeals Unpublished, August 29, 2006.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2004).

 

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A05-2467

 

Marie Guess, as Trustee for the Heirs

and Next of Kin of Michael L. Guess,

Appellant,

 

vs.

 

Mark Priore, Special Administrator for

the Estate of Richard E. Conry, deceased,

Defendant,

 

Aviation Charter, Inc., et al.,

Respondents.

 

Filed August 29, 2006

Affirmed

Hudson, Judge

 

St. Louis County District Court

File No. 69-CX-04-602863

 

 

Kenneth R. White, MacKenzie & Gustafson, Ltd., 326 South Minnesota Avenue, P.O. Box 360, St. Peter, Minnesota 56082; and

 

Michael B. Padden, Padden & Associates, P.L.L.C., 782 Northwestern Building, 275 East Fourth Street, St. Paul, Minnesota 55101 (for appellant)

 

Michael C. Lindberg, Johnson & Lindberg, P.A., 7900 International Drive, Suite 960, Minneapolis, Minnesota 55425-1582 (for respondents)

 

            Considered and decided by Worke, Presiding Judge; Kalitowski, Judge; and Hudson, Judge.

U N P U B L I S H E D   O P I N I O N

HUDSON, Judge

            This is an appeal of the district court's grant of summary judgment on appellant's lawsuit against respondent Aviation Charter for defense and indemnity of appellant's claims against the co-employee's estate under Minn. Stat. § 181.970, subd. 1 (2004), and on appellant's lawsuit against respondent Beech Transportation for vicarious liability under Minn. Stat. § 360.0216 (2004).  Because the employer and the co-employee were immune from suit pursuant to the workers' compensation law, the district court properly granted summary judgment in favor of respondents, and we affirm.

FACTS

            On October 25, 2002, a plane carrying Senator Paul Wellstone crashed during an approach to the Eveleth-Virginia Municipal Airport, killing all eight persons on board.  On that flight, Richard Conry was the assigned pilot-in-command and Michael Guess was the second-in-command (copilot).  Both were employed by respondent Aviation Charter, Inc., which had the policy that the pilot-in-command was responsible for operating the flight controls during the approach and landing, while the copilot was responsible for the communications.  The plane was owned by respondent Beech Transportation, Inc.  According to a National Transportation Safety Board report dated November 18, 2003, "the probable cause of the accident was the flight crew's failure to maintain adequate airspeed, which led to an aerodynamic stall from which they did not recover."

            Guess's heirs and next of kin sued Conry's estate for gross negligence; sued Aviation Charter, as Conry's employer, for defense and indemnity under Minn. Stat. § 181.970 (2004); and sued Beech, as the owner of the aircraft, for vicarious liability under Minn. Stat. § 360.0216 (2004).  Respondents moved for summary judgment or dismissal of the action.

            The district court ruled that because Conry was the assigned pilot-in-command, most radio communications were conducted by Guess, and Aviation's policy provided that the pilot-in-command should operate the flight controls during the landing, a fact-finder could conclude that Conry was piloting the plane when it crashed.  Accordingly, genuine issues of material fact existed on the claim of Conry's gross negligence.  Nevertheless, the court granted summary judgment to respondents, concluding that appellant's exclusive remedy was under the workers' compensation act and that appellant could not recover against Aviation Charter under Minn. Stat. § 181.970 or against Beech under Minn. Stat. § 360.0216.  Pursuant to a stipulation by the parties, the district court entered final judgment as to respondents under Minn. R. Civ. P. 54.02.  This appeal follows.

D E C I S I O N

            When reviewing summary judgment, an appellate court must determine (1) whether there are any genuine issues of material fact and (2) whether the district court erred in its application of law.  State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990).  This court will view the evidence in the light most favorable to the party against whom summary judgment was granted.  Grondahl v. Bulluck, 318 N.W.2d 240, 242 (Minn. 1982).

I

            The district court granted summary judgment to Aviation Charter, Guess's employer, on appellant's claim under Minn. Stat. § 181.970, subd. 1 (2004), ruling that under Minn. Stat. § 176.031 (2004), the workers' compensation act was appellant's exclusive remedy.  "The workers' compensation system in Minnesota is based on a mutual renunciation of common law rights and defenses by employers and employees alike."  Minn. Stat. § 176.001 (2004).  Under this statute, the employer "is liable to pay compensation in every case of personal injury or death of an employee arising out of and in the course of employment without regard to the question of negligence."  Minn. Stat. § 176.021, subd. 1 (2004).  "The liability of an employer prescribed by this chapter is exclusive and in the place of any other liability."  Minn. Stat. § 176.031.  "Under this scheme, an employee is precluded from bringing a tort action for damages against the employer." Stringer v. Vikings Football Club, LLC, 705 N.W.2d 746, 754 (Minn. 2005) (footnote omitted).  The only exception arises if an employer intentionally injures an employee, in which case the employee may sue the employer directly.  Gunderson v. Harrington, 632 N.W.2d 695, 70203 (Minn. 2001).

            Also, under the workers' compensation law, a co-employee who works for the same employer "is not liable for a personal injury incurred by another employee unless the injury resulted from the gross negligence of the coemployee[.]"  Minn. Stat. § 176.061, subd. 5(c) (2004).  Appellant sued Conry's estate under this exception to co-employee immunity, alleging that Conry had been grossly negligent.  Appellant contends that because it is undisputed that Conry was acting within the course of his duties as a pilot for Aviation Charter, the latter has the duty to indemnify Conry's estate for damages due to Conry's gross negligence.

            Resolution of this issue requires application of the supreme court's recent decision in Stringer, 705 N.W.2d at 75460, which addressed co-employee immunity under the workers' compensation act.  The Stringer opinion was released after the district court issued its decision.  Appellant argues that under the current posture of the present case, in which the district court denied summary judgment as to Conry's estate, Conry's estate remains a viable defendant and its liability is subject to further adjudication before the district court.  Further, Conry's estate did not seek review of the district court's decision in light of Stringer.  Consequently, appellant contends Stringer has no application.  We disagree.

            Respondents are not seeking to have this court overturn the decision denying summary judgment to Conry's estate and we are not deciding that issue.  Instead, respondents seek a determination on their liability in light of Stringer.  Further, while the district court did not have the opportunity to address Stringer, the case is unquestionably before this court and we must consider it.  In addition, this court will affirm summary judgment "if it can be sustained on any grounds."  Myers Through Myers v. Price, 463 N.W.2d 773, 775 (Minn. App. 1990), review denied (Minn. Feb. 4, 1991).  Therefore, we will consider Stringer in analyzing this appeal.

            Returning to appellant's arguments, we first address whether she can prevail on the co-employee action under the workers' compensation statute.  In Stringer, the court ruled that to establish a gross-negligence claim against a co-employee, there must be a showing that (a) the co-employee had a personal duty toward the employee, the breach of which resulted in the employee's injury, if the action was not part of the co-employee's general administrative duties, and (b) the injury arose from the co-employee's gross negligence.  Stringer, 705 N.W.2d at 754.  For such a personal duty to exist, "the coemployee must have (1) taken direct action toward or have directed another to have taken direct action toward the injured employee, and (2) acted outside the course and scope of employment."  Id. (citations omitted).  Appellant's assertion that Conry acted within the course and scope of employment, necessary to the claim of indemnity under Minn. Stat. § 181.970, is fatal to the argument that Conry was grossly negligent for purposes of co-employee liability because, under Stringer, a co-employee is grossly negligent only when acting outside the scope of employment.  Consequently, Conry would be immune from suit under Minn. Stat. § 176.061, subd. 5(c).

            Appellant also sued respondent Aviation Charter, seeking defense and indemnity under Minn. Stat. § 181.970, subd. 1 (2004).  Under that section, an employer has an obligation to defend and indemnify its employee for civil damages claimed against the employee when the employee was acting in the performance of his duties, unless the employee was guilty of "intentional misconduct, willful neglect of the duties of the employee's position, or bad faith."  Id.  Therefore, we address whether Aviation Charter can be liable for defense and indemnity under Minn. Stat. § 181.970, subd. 1, when both Aviation Charter and the co-employee are immune under the workers' compensation laws.  Appellant acknowledges that the indemnification provided in subdivision 1 does not apply to "indemnification rights for a particular liability specifically governed by other law."  Id., subd. 2(4).  Nevertheless, appellant contends that had the legislature wished to exclude workers' compensation cases from section 181.970, it would have done so explicitly.  Further, appellant notes that a court cannot supply language that the legislature did not include in the statute.  Genin v. 1996 Mercury Marquis, 622 N.W.2d 114, 117 (Minn. 2001).  Appellant also distinguishes between an employer's direct liability and its obligation to defend and indemnify.  As to the former, under Minn. Stat. § 176.031, the employer's liability under the act is exclusive and "in the place of any other liability," with a narrow exception for an employer's intentional injury of the employee.  Gunderson, 632 N.W.2d at 703.  But under Minn. Stat. § 181.970, no direct suit is brought against an employer; instead, the employer is the source of defense and indemnity.  Appellant contends that the legislature allocated the risks by providing that when an employee suffers damages through the gross negligence of a co-employee, the co-employee is directly liable and the employer has financial exposure through defense and indemnity.

            Indemnify is defined as "[t]o reimburse (another) for a loss suffered because of a third party's act or default."  Black's Law Dictionary 772 (7th ed. 1999).  Applying indemnity under section 181.970 would require Aviation Charter to indemnify Conry's estate for its liability for Conry's acts causing the losses to appellant.  But under the workers' compensation law, as discussed above, Aviation Charter and Conry's estate are immune from liability.  Appellant therefore cannot prevail on her claims under Minn. Stat. § 181.970, subd. 1.

II

            Appellant claims that under Minn. Stat. § 360.0216 (2004), Beech Transportation, as the owner of the aircraft, is vicariously liable for Conry's alleged negligence.  This section provides that "[w]hen an aircraft is operated . . . by a person other than the owner, with the consent of the owner, expressed or implied, the operator shall in case of accident be deemed the agent of the owner of the aircraft in its operation."  Minn. Stat. § 360.0216.  Thus, an owner of the aircraft is subject to statutory vicarious liability for the negligence of the operator of the aircraft.  Ewers v. Thunderbird Aviation, Inc., 289 N.W.2d 94, 97 (Minn. 1979).

            Although the parties proffer various arguments, the determinative question here is whether Beech can be vicariously liable under Minn. Stat. § 360.0216 when Conry, its agent, is immune from liability.  An employer's vicarious liability is based on its employee's tortious acts occurring while conducting the employer's business.  Nadeau v. Melin, 260 Minn. 369, 376, 110 N.W.2d 29, 34 (1961).  If the underlying liability does not exist, there can be no vicarious liability.  See Reedon of Faribault, Inc. v. Fid. & Guar. Ins. Underwriters, Inc., 418 N.W.2d 488, 490 (Minn. 1988) (holding that release of insurance agent from liability by Pierringer agreement released insurer from vicarious liability).  Because Conry was immune from liability, Beech cannot be vicariously liable under Minn. Stat. § 360.0216.

            The decision of the district court granting summary judgment to respondents is affirmed.

            Affirmed.