FRANTZ v. D'AURIZIO DRYWALL AND ACOUSTICS

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FRANTZ v. D'AURIZIO DRYWALL AND ACOUSTICS
2010 OK CIV APP 43
233 P.3d 396
Case Number: 106812
Decided: 12/18/2009
Mandate Issued: 04/15/2010
DIVISION III
THE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION III

RONALD FRANTZ, Plaintiff/Appellant,
v.
D'AURIZIO DRYWALL AND ACOUSTICS, an Oklahoma corporation, NICK D'AURIZIO, personally, Defendants/Appellees,
and
TMG STAFFING SERVICES, INC., a foreign corporation, COLLEEN THOSTESON, personally, ROSEMARY McKIBBEN, personally, JEFF GOODSON, personally, and TRANSPACIFIC INTERNATIONAL INSURANCE CO., LTD., a foreign corporation, Defendants.

APPEAL FROM THE DISTRICT COURT OF MURRAY COUNTY, OKLAHOMA

HONORABLE JOHN H. SCAGGS, JUDGE

AFFIRMED

Darryl F. Roberts, Ardmore, Oklahoma, for Plaintiff/Appellant,
David L. Thomas, THOMAS & TERRELL, Oklahoma City, Oklahoma, for Defendants/Appellants.

BAY MITCHELL, CHIEF JUDGE:

¶1 Plaintiff Ronald Frantz (Frantz) appeals from an Order granting summary judgment in favor of Defendants D'Aurizio Drywall and Acoustics and Nick D'Aurizio (collectively, D'Aurizio defendants). The district court determined it does not have jurisdiction over Frantz's claims against the D'Aurizio defendants for enforcement of two Workers' Compensation Court awards (each properly certified unpaid) previously entered in favor of Frantz.1

¶2 Frantz was hired by Defendant Nick D'Aurizio, the principal of D'Aurizio Drywall, to work on a construction job in 2003. During the employment, D'Aurizio Drywall had a contract with Defendant TMG Staffing Services, Inc., (TMG), a professional employer organization (PEO), pursuant to which TMG provided payroll services and workers' compensation coverage for a fee. Frantz sustained a work-related injury in January 2003, whereupon he filed a workers' compensation claim against TMG and its purported workers' compensation insurance carrier, Transpacific International Insurance Company, Ltd. (Transpacific). For reasons unclear from the record, Frantz did not assert claims against D'Aurizio Drywall and/or Nick D'Aurizio in the Workers' Compensation Court.

¶3 Frantz thereafter filed this district court action against D'Aurizio Drywall, Nick D'Aurizio, TMG, Transpacific, and individual TMG officers. Judgment was ultimately entered establishing liability of Defendants TMG and its officers Rosemary McKibben, and Jeff Goodson, on the certified judgments of the Workers' Compensation Court which remained unpaid, and for Frantz's actual and punitive damages.

¶4 The D'Aurizio defendants' successful Motion for Summary Judgment challenged the District Court's jurisdiction. They argue the law does not permit Frantz to enforce a Workers' Compensation Court judgment against another employer who was not a party/respondent to the underlying workers' compensation proceeding. They contend the Workers' Compensation Court has exclusive jurisdiction over the matter. Further, the D'Aurizio defendants argue that to impose liability on them after the fact in District Court without affording them a first-instance opportunity to participate as parties in the Workers' Compensation proceeding would be an unconstitutional violation of their due process rights under the U.S. and Oklahoma Constitutions.

¶5 Frantz argues the public policy underlying Oklahoma's Workers' Compensation scheme supports a finding that the District Court has jurisdiction to enforce the Workers' Compensation Court judgments against D'Aurizio Drywall and Nick D'Aurizio even though they were not parties in the Workers' Compensation proceeding. Essentially, this argument at least implies that the protection of the injured worker's right to compensation trumps any jurisdictional defects. Additionally, Frantz asserts the trial court's summary judgment order is akin to allowing employer D'Aurizio Drywall and D'Aurizio to escape workers' compensation obligations via its "employment of a bogus professional employers organization and a non-existent insurance company as the employer's agent."

¶6 Appellate courts review an award of summary judgment de novo, giving no deference to the trial court. Lowery v. Echostar Satellite Corp.,

¶7 The issue, as it is precisely before us - the jurisdiction of the District Court in an action to enforce workers' compensation judgments (and subsequent tort claims arising from the failure of a Public Employer Organization (PEO) to pay benefits) against an employer not previously named in the Workers' Compensation proceeding - appears to be one of first impression.

¶8 Oklahoma law acknowledges and regulates Professional Employer Organizations. See, "Oklahoma Professional Employer Organization Recognition and Registration Act",

¶9 First, "[t]he Workers' Compensation Court has exclusive original jurisdiction over all proceedings for compensation which are legally due for a job-related injury.... The right to recover charges for medical care provided for personal injuries arising out of and in the course of covered employment lies solely within the Workers' Compensation Court." Thomas v. Okla. Orthopedic & Arthritis Foundation, Inc.,

¶10 Second, the exclusive remedy doctrine provides "[t]he liability ... [under the Workers' Compensation Act] shall be exclusive and in place of all other liability of the employer ..."

¶11 A first instance determination of the workers' compensation liability of these Defendants in the proper forum is required to afford them due process, particularly where Frantz seeks to impose personal liability upon Nick D'Aurizio for the workers' compensation benefits unpaid by employer, TMG. See PFL Life Ins. Co. v. Franklin,

¶12 The trial court correctly granted the D'Aurizio defendant's Motion for Summary Judgment. As to these defendants, subject matter jurisdiction was lacking. Exclusive jurisdiction over Frantz's employment-related claims rests with the Workers' Compensation Court and permitting Frantz to proceed against these defendants in district court would certainly be violative of due process

¶13 Summary judgment in favor of Defendants D'Aurizio Drywall and Nick D'Aurizio on this record was appropriate, and we therefore AFFIRM.

HANSEN, P.J., and JOPLIN, J., concur.

FOOTNOTES