FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT November 13, 2019
_________________________________
Elisabeth A. Shumaker
Clerk of Court
PROGRESSIVE NORTHERN
INSURANCE COMPANY,
Plaintiff - Appellee,
v. No. 18-7057
(D.C. No. 6:17-CV-00229-JHP)
WILMA CHARLIEN PEAVLER, as the (E.D. Okla.)
Special Administrator for the Estate of
Christopher Allen Richter,
Defendant - Appellant,
and
J&S EXCHANGE, INC.,
Defendant.
_________________________________
ORDER AND JUDGMENT*
_________________________________
Before HOLMES, O’BRIEN, and MATHESON, Circuit Judges.
_________________________________
In this declaratory judgment action, Wilma Charlien Peavler, as Special
Administrator for the estate of Christopher Allen Richter, appeals the district court’s
*
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist in the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
grant of summary judgment to Progressive Northern Insurance Company
(Progressive). Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.
I
This case stems from a fatal, single-vehicle accident. Ivan Fry was driving
Mr. Richter and another passenger, Zach Vasser, to a job site in his truck. Mr. Fry
and Mr. Richter were both employees of J&S Exchange, Inc. (J&S), which owned
tools and equipment in Mr. Fry’s truck. There was evidence that J&S directed
Mr. Fry to keep the tools in his truck and to drive Mr. Richter and Mr. Vasser to the
job site. On the way, Mr. Fry apparently lost control of the truck and crashed;
Mr. Richter died from his injuries. Both Mr. Fry and J&S were insured under
separate automobile insurance policies issued by Progressive.1
Ms. Peavler initiated a tort suit in Oklahoma state court against Mr. Fry and
J&S solely under a respondeat superior theory. She alleged J&S was vicariously
liable because Mr. Fry was acting in the scope of his employment at the time of the
accident. J&S moved to dismiss the suit, arguing that Ms. Peavler’s exclusive
remedy was a workers’ compensation claim under Oklahoma’s Administrative
Workers’ Compensation Act (AWCA). See Okla. Stat. tit. 85A, §§ 1-125. The
AWCA’s exclusive remedy provision states:
The rights and remedies granted to an employee subject to the
provisions of the [AWCA] shall be exclusive of all other rights and
1
Progressive sought declaratory relief under both policies. The district court
determined the Fry policy provided $25,000 of liability coverage and the J&S policy
provided no uninsured/underinsured motorist or medical payments coverage. These
conclusions are not challenged on appeal.
2
remedies of the employee . . . or anyone else claiming rights to recovery
on behalf of the employee against the employer, or any . . . employee
. . . of the employer on account of injury, illness, or death. Negligent
acts of a co-employee may not be imputed to the employer.
Id., § 5(A); see Odom v. Penske Truck Leasing Co., 893 F.3d 739, 744 (10th Cir.
2018) (recognizing that AWCA’s exclusive-remedy provision provides a substantive
defense to civil liability). Although J&S pointed out that the AWCA specifically
barred Ms. Peavler’s respondeat superior theory, she asserted her suit was not
subject to the AWCA because Mr. Fry was acting in the scope of his employment,
but Mr. Richter was not. Under the AWCA, an employee traveling to and from his
place of work generally is not acting in the course and scope of his employment and
therefore does not have a compensable injury. See Okla. Stat. tit. 85A, §§ 2(9)(a),
2(13)(a). The state court denied J&S’s motion to dismiss and later denied its motion
for summary judgment.
While the state suit continued, Progressive initiated this declaratory judgment
action in federal court to determine its obligations under the J&S automobile policy.
Progressive argued that Ms. Peavler’s suit fell under the AWCA and coverage was
eliminated under an exclusion (Exclusion 3) in the J&S policy for “[a]ny obligation
for which an insured or an insurer of that insured, even if one does not exist, may be
held liable under workers’ compensation, unemployment compensation, disability
benefits law, or any similar law.” Aplt. App. at 122. Progressive reasoned that
Mr. Richter’s death was an obligation for which J&S may be held liable under
workers’ compensation law.
3
The district court, in a detailed, 53-page decision, granted summary judgment
to Progressive, ruling in part that it was appropriate to exercise jurisdiction in this
case notwithstanding the pendency of the state suit, and that Exclusion 3 applied
because Mr. Richter’s death was an obligation for which J&S “may be held liable
under workers[’] compensation law,” id. at 345 (ellipsis and internal quotation marks
omitted). Ms. Peavler challenges both rulings.
II
A. The District Court’s Exercise of Jurisdiction
We first consider the district court’s decision to exercise jurisdiction. “[T]he
Declaratory Judgment Act gave the federal courts competence to make a declaration
of rights; it did not impose a duty to do so.” State Farm Fire & Cas. Co. v. Mhoon,
31 F.3d 979, 982 (10th Cir. 1994) (internal quotation marks omitted). Accordingly,
“district courts possess discretion in determining whether and when to entertain an
action under the Declaratory Judgment Act, even when the suit otherwise satisfies
subject matter jurisdictional prerequisites.” Wilton v. Seven Falls Co., 515 U.S. 277,
282 (1995). In deciding whether to exercise jurisdiction, courts should consider
several factors, including “whether use of a declaratory action would increase friction
between our federal and state courts and improperly encroach upon state
jurisdiction.” Mhoon, 31 F.3d at 983 (internal quotation marks omitted). We do “not
engage in a de novo review of all the various fact-intensive and highly discretionary
factors involved. Instead, [we] only ask whether the trial court’s assessment of them
was so unsatisfactory as to amount to an abuse of discretion.” Id.
4
Ms. Peavler contends the district court’s exercise of jurisdiction creates
friction with the state court order denying J&S’s motion to dismiss. As the district
court explained, however, the state court ruling has no impact on the issues here.
This case concerns Progressive’s statutory and contractual duties to defend and
indemnify J&S; the state suit, by contrast, concerns J&S’s liability to Mr. Richter’s
estate under a respondeat superior theory. Both suits stem from the same underlying
facts, but the statutory and contractual issues here are distinct from the tort claims
before the state court. Of course, there might have been friction if, as Ms. Peavler
contends, the district court had conclusively determined that Mr. Richter was acting
in the scope of his employment; if he was, presumably Ms. Peavler would be bound
to the workers’ compensation remedy. But the district court repeatedly stated it was
not making that finding, see Aplt. App. at 338, 344. The court concluded only that
Mr. “Richter may have been acting in the course and scope of his employment,” id. at
338 (emphasis added), which triggered the exclusion. Under these circumstances, the
district court did not abuse its discretion in exercising jurisdiction over the
declaratory judgment action.
B. Merits
Turning to the merits of this dispute, “[w]e review summary judgment de novo
and apply the same legal standard as the district court.” Phila. Indem. Ins. Co. v.
Lexington Ins. Co., 845 F.3d 1330, 1336 (10th Cir. 2017). “A court ‘shall grant
summary judgment if the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law.’” Id. (quoting
5
Fed. R. Civ. P. 56(a)). Because this declaratory judgment action is predicated on
diversity jurisdiction, see 28 U.S.C. § 1332, we apply the law of the forum state,
Oklahoma, Universal Underwriters Ins. Co. v. Winton, 818 F.3d 1103, 1105-06
(10th Cir. 2016).
“Under Oklahoma law, ‘an insurance policy is to be treated as a contract’ and
is ‘enforced according to its terms.’” Phila. Indem., 845 F.3d at 1337 (brackets
omitted) (quoting Equity Mut. Ins. Co. v. Spring Valley Wholesale Nursery, Inc.,
747 P.2d 947, 953 (Okla. 1987)). “The whole of a contract is to be taken together, so
as to give effect to every part, if reasonably practicable, each clause helping to
interpret the others.” Okla. Stat. tit. 15, § 157. “We accept the contract language in
its plain, ordinary, and popular sense.” Broom v. Wilson Paving & Excavating, Inc.,
356 P.3d 617, 628 (Okla. 2015) (brackets and internal quotation marks omitted).
Progressive stipulated the truck was an “insured auto” and J&S was an
insured. The district court observed, however, that Exclusion 3 eliminated coverage
for “[a]ny obligation for which” J&S “may be held liable under workers’
compensation . . . law.” Aplt. App. at 330 (emphasis omitted). Without deciding
whether Mr. Richter actually was or was not acting in the scope of his employment,
the court determined he may have been and, therefore, the exclusion applied because
J&S may be held liable under workers’ compensation law. We perceive no error.
The AWCA provides that the exclusive remedy against an employer for an
employee injured in the course and scope of his employment is a claim for workers’
compensation benefits. See Okla. Stat. tit. 85A, § 5(A). The AWCA specifically
6
bars respondeat superior theories, stating, “Negligent acts of a co-employee may not
be imputed to the employer.” Id. It also states that the statutory immunity is not
defeated by the denial of the employee’s claim for compensation or ineligibility for
benefits. See id. § 5(C) (“The immunity from civil liability described in subsection A
of [the statute] shall apply regardless of whether the injured employee is denied
compensation or deemed ineligible to receive compensation under this act.”).
Particularly relevant for our purposes, the AWCA defines “Course and scope
of employment” as:
an activity of any kind or character for which the employee was hired
and that relates to and derives from the work, business, trade or
profession of an employer, and is performed by an employee in the
furtherance of the affairs or business of an employer. The term includes
activities conducted on the premises of an employer or at other locations
designated by an employer and travel by an employee in furtherance of
the affairs of an employer that is specifically directed by the employer.
This term does not include:
a. an employee’s transportation to and from his or her place of
employment[.]
Id., § 2(13).
Given this definition and the broader statutory scheme, we have little difficulty
concluding that Mr. Richter’s death was an “obligation for which” J&S “may be held
liable under workers’ compensation . . . law.” Aplt. App. at 122.2 Ms. Peavler seeks
to recover for the death of an employee, Mr. Richter, by imputing the alleged
2
To the extent Ms. Peavler contends the exclusion is ambiguous, she failed to
preserve this issue in the district court and offers no reason why we should consider it
now. We decline to consider the issue. See Richison v. Ernest Grp., Inc., 634 F.3d
1123, 1127-28 (10th Cir. 2011).
7
negligence of a fellow employee, Mr. Fry, to their employer, J&S. But the AWCA
expressly states that “[n]egligent acts of a co-employee may not be imputed to the
employer.” Okla. Stat. tit. 85A, § 5(A). Ms. Peavler attempts to avoid this result by
arguing that Mr. Richter was not acting in the scope of his employment, but this
argument does not clearly circumvent the AWCA. Although the AWCA defines
“[c]ourse and scope of employment” to exclude “an employee’s transportation to and
from his . . . place of work,” id., § 2(13)(a), Oklahoma courts have, under certain
circumstances, found that employees traveling to a work site, hauling material for the
benefit of an employer, were acting “in furtherance of the affairs of an employer” and
thus in the “[c]ourse and scope of employment.” See, e.g., Pina v. Am. Piping
Inspection, Inc., 419 P.3d 231, 237 & n.12 (Okla. 2018). Mr. Fry and Mr. Richter
were both J&S employees driving to J&S’s job site with J&S’s tools in the truck.
There was evidence that J&S directed Mr. Fry to keep the tools in his truck, bring
them to the job site, and drive Mr. Richter and Mr. Vasser to the job site.3 While
these circumstances may not establish that Mr. Fry and Mr. Richter were acting in the
scope of their employment, Oklahoma case law indicates they might have been, and
3
Ms. Peavler submitted this evidence—a transcript of Mr. Fry’s unsworn
statement—to establish Mr. Fry’s directives. The district court ruled the evidence
could be considered because it is not hearsay. Ms. Peavler now seems to dispute the
court’s rationale, though her argument is unclear. See Aplt. Br. at 27-28. To the
extent she contends this evidence was hearsay and should not have been considered,
the invited-error doctrine bars her complaint. See United States v. Deberry, 430 F.3d
1294, 1302 (10th Cir. 2005). (“[T]he invited-error doctrine precludes a party from
arguing that the district court erred in adopting a proposition that the party had urged
the district court to adopt.”).
8
therefore J&S may be held liable under workers’ compensation law, which is all
Exclusion 3 requires.
Ms. Peavler offers a broad rebuttal that essentially contends she should not be
bound to Oklahoma’s statutory scheme. She begins by challenging the district
court’s observation that the Oklahoma Workers’ Compensation Commission (WCC)
has exclusive responsibility for finding whether or not Mr. Richter was acting in the
scope of his employment. See Aplt. Br. at 9-10. She says the WCC does not prevent
the judiciary from interpreting the AWCA and she should not be required to file a
workers’ compensation claim rather than a civil action, which would “raise questions
of equal protection, special legislation, and open access to courts,” id. at 13. She
cites multiple cases that purportedly recognize that courts can and do evaluate
whether injuries are compensable under the AWCA. See id. at 14-18. She therefore
concludes that she appropriately filed her tort suit in state court and that the district
court erred in faulting her for doing so. See id. at 18-20.
To the extent these arguments challenge the AWCA’s statutory scheme, they
are beyond the scope of this appeal. To the extent these arguments challenge
Exclusion 3 on public policy grounds, they are unavailing. Oklahoma’s Compulsory
Insurance Law mandates personal liability insurance, see Okla. Stat. tit 47,
§ 7-600(4), but not for injuries covered by workers’ compensation, see id., § 7-324(e)
(“Such motor vehicle liability policy need not insure any liability under any
workmen’s compensation law nor any liability on account of . . . death of an
employee of the insured while engaged in the employment . . . of the insured . . . .”).
9
This exception places the burden on employers to carry workers’ compensation
coverage for employment-related injuries. See Deffenbaugh v. Hudson, 791 P.2d 84,
86 (Okla. 1990) (recognizing automobile insurers are not obliged to protect their
insureds against losses that fall under the workers’ compensation scheme and that
“[t]he terms of [§ 7-324] clearly relieve insurers of any legal obligation to include in
the standard motor vehicle liability policy a provision for indemnity against
employment-related harm”). The rationale is that there is no need for double
coverage of employees already covered by workers’ compensation insurance. See
State Farm Mut. Auto. Ins. Co. v. Dyer, 19 F.3d 514, 524 (10th Cir. 1994) (holding,
under Wyoming law, that “[t]here is no imperative public policy need for automobile
liability insurance where the injured party is covered by worker’s compensation”);
8 Couch on Ins., § 115:13 (3d ed. June 2019 Update) (“Provisions excluding from
coverage of automobile liability policies liability for injury or death of the insured’s
employees attempt to limit the coverage of the policy by excluding the special
hazards incident to the master-servant relationship, coverage for which is usually
available through workers’ compensation or employer’s liability insurance.”). If an
employer does not carry workers’ compensation insurance, the employee may pursue
a civil action for damages. See Okla. Stat. tit. 85A, § 5(B)(1).
It is undisputed that J&S carried workers’ compensation insurance and that
Ms. Peavler never pursued a workers’ compensation claim. The AWCA therefore
provides her exclusive remedy for injuries sustained in the course and scope of
Mr. Richter’s employment. Whether he actually was acting in the scope of his
10
employment is an issue we need not decide because the plain language of Exclusion 3
applies so long as J&S “may be held liable under workers’ compensation . . . law.”
Aplt. App. at 122. Oklahoma law indicates that condition is satisfied.
III
Accordingly, the judgment of the district court is affirmed.
Entered for the Court
Jerome A. Holmes
Circuit Judge
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