Hjelle v. Mid-State Consultants, Inc.

F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
JAN 11 2005
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT

GREGG C. HJELLE,

Plaintiff - Appellant,
v. No. 03-8085
MID-STATE CONSULTANTS, INC.,
a Utah corporation,

Defendant - Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF WYOMING
(D.C. NO. 00-CV-230-J)

George Santini of Ross, Ross & Santini, LLC, Cheyenne, Wyoming, for Plaintiff -
Appellant.

Bruce S. Asay of Associated Legal Group, LLC, Cheyenne, Wyoming, for
Defendant - Appellee.

Before MURPHY , ANDERSON , and HARTZ , Circuit Judges.

HARTZ , Circuit Judge.

Plaintiff Gregg Hjelle, an employee of Ayrcom Contracting, Inc., was

seriously injured when a large chunk of frozen dirt struck him during the
backfilling of the trench in which he was working. At the bench trial of this

diversity suit, see 28 U.S.C. § 1332, he argued that Defendant Mid-State

Consultants, a third-party independent contractor, is liable because it assumed

control over the jobsite on the day of the injury. Mid-State responded that its role

was confined to inspecting and approving the work performed and that it did not

exercise control. The district court granted judgment to Mid-State. Plaintiff

appeals. We have jurisdiction under 28 U.S.C. § 1291 and affirm.

I. BACKGROUND

A. Facts

The following account is based on unchallenged fact findings by the district

court and undisputed evidence. Plaintiff, a resident of North Dakota, was

employed by Ayrcom when he was severely injured on December 7, 1996, in rural

Wyoming. Ayrcom was an independent contractor employed by RT

Communications to install fiber-optic cables and ancillary equipment in

accordance with industry standards. This work was subject to inspection by RT

Communications or its designee. RT Communications entered into a separate

contract with Mid-State, a Utah corporation, to inspect Ayrcom’s work and serve

as project engineer.

On the morning of December 7, 1996, Plaintiff accompanied his friend and

fellow Ayrcom employee Nate Johnson to the jobsite where Johnson and other

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members of his work crew were to finish installing a “remote”—a concrete vault

where fiber-optic cables interconnect. Due to his excessive drinking the night

before, Johnson became ill and Plaintiff took over the driving. The two arrived at

about 12:30 p.m. Jerry Welfl, Mid-State’s inspector at the jobsite, was the only

person there when they arrived.

Welfl had come to the jobsite at 8:00 a.m. and waited for the Ayrcom crew

to arrive and install the remote. While he waited, an Ayrcom employee came to

the site to start the backhoe and then left. A second Ayrcom employee, project

supervisor Sherman Lysne, also stopped by the jobsite and informed Welfl that a

crew was on its way. Shortly before 11:00 a.m. Welfl left, but he soon returned

when his supervisor, project engineer Jack Warren, called his cellular phone and

informed him that the Ayrcom crew was on the way and that Ayrcom employee

Larry Svenspladen would supervise the work crew. Plaintiff and Johnson arrived

first. Plaintiff told Welfl that Johnson was sick.

Because Johnson was incapacitated, Welfl asked Plaintiff whether he could

operate the backhoe. Plaintiff said he had a little experience operating tractors

and similar equipment on the farm where he grew up. According to Welfl,

Plaintiff’s operation of the backhoe was satisfactory. But Plaintiff was unfamiliar

with how to install a remote, so Welfl told him where to dig the trench for steel

pipe that needed to be installed.

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 The rest of the Ayrcom work crew arrived in two groups after 1:00 p.m.

About the time of the arrival of the first group, Jeff Hegg and Rod Cunningham,

Johnson replaced Plaintiff on the backhoe. A half hour later the second group,

Maurice Zikmund and Svenspladen, the supervisor, arrived, although

Svenspladen, accompanied by Hegg, left the immediate vicinity of the remote-

installation site and began work on a truck. He continued to work on the truck

until Plaintiff’s injury, at no time giving any instruction or direction to the work

crew.

At least twice during the installation process Johnson operated the backhoe.

At one point Johnson was awakened (while slumbering on the backhoe) to dig a

trench. Johnson then resumed sleeping on the backhoe while Plaintiff, Zikmund,

and Cunningham proceeded with installing the necessary pipes and duct work.

When they finished, Welfl indicated that the installation was satisfactory so the

trench could be filled. Johnson was then roused.

After approving the work, Welfl noticed a minor defect: the pipe at the

bottom of the four-foot-deep trench was not adequately marked. Welfl told

Plaintiff, who was in the trench along with Zikmund and Cunningham, to mark

the pipe with scare tape. It was the usual practice for Ayrcom workers to stand in

the trench during backfilling to be sure that the pipe and conduit did not move out

of place. To mark the pipe, Plaintiff bent over in the trench to tie the tape to the

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end of the pipe. Johnson proceeded to fill the trench with the backhoe. Plaintiff

was unaware that Johnson had commenced backfilling the trench and Johnson was

unaware that Plaintiff was in it. Attempting to fill the trench, Johnson dislodged

a large piece of frozen dirt, causing it to tumble over the dirt pile and into the

trench, pinning Plaintiff against the trench wall. Plaintiff’s only warning of

Johnson’s approach was someone’s telling him in a normal tone of voice to “look

out.” Plaintiff suffered severe injuries, incurring medical expenses exceeding

$100,000.

B. Proceedings Below

At the bench trial Plaintiff argued that Welfl, acting on behalf of Mid-State,

“affirmatively assumed duties and exercised control over the manner in which

Ayrcom, [Plaintiff’s] employer, was accomplishing its contractual

responsibilities.” Aplt. App. at 21 ¶ 25. But the court found:

[Welfl] . . . did not affirmatively assume a pervasive and controlling
role in the work being accomplished by the Ayrcom employees in this
case. Welfl did not control the methods of work or the operative
details involved in accomplishing the tasks at hand on the date in
question. Rather, Welfl performed duties that were expressly related
to his jobsite inspection responsibilities to assure that the project was
completed in accordance with the applicable specifications. Welfl did
not control the methods of work or operative details, and the Ayrcom
crew performed the tasks required to install the remote in the manner
in which they usually performed such tasks. Welfl was doing the
very job that Mid-State[] was hired to perform; Ayrcom employees
were doing the precise tasks that the contract between their employer
and RT Communications required. Any crossover of functions
between Welfl, acting as Mid-State[’s] onsite inspector, and Ayrcom

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 was incidental and not such that it establishes liability on the part of
Mid-State Consultants.

Aplt. App. at 30-31 ¶ 32. The court concluded that Mid-State owed no duty of

care to Plaintiff and that Welfl’s conduct was not the proximate cause of

Plaintiff’s injury.

On appeal Plaintiff argues that the district court erred in its application of

Wyoming law, clearly erred in its factual finding that Mid-State did not assume

control over the work or assume a duty of jobsite safety, and failed to make

adequate factual findings as to whether Mid-State assumed an affirmative duty for

Plaintiff’s safety during the backfilling operations.

II. DISCUSSION

In a diversity action such as this, we apply the same substantive law as

would the forum state and review the district court’s determination of that law de

novo. Hays v. Jackson Nat’l Life Ins., 105 F.3d 583, 587 (10th Cir. 1997). There

is no dispute that Wyoming law governs.

Ayrcom and Mid-State were both retained as independent contractors by RT

Communications. Plaintiff relies on Wyoming law regarding the duty of an owner

to an employee of an independent contractor hired by the owner. Because it is

undisputed that Mid-State was acting as an agent of the owner, RT

Communications, we will assume with respect to Plaintiff’s claims that Mid-

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State’s liability would be no greater than if it had been the owner. Both parties

have proceeded on this implicit assumption.

Wyoming law adopts the general rule that an owner “is not obligated to

protect the employees of an independent contractor from hazards which are

incidental to, or part of, the very work the contractor was hired to perform.” Jones

v. Chevron U.S.A., Inc., 718 P.2d 890, 894 (Wyo. 1986). But there are two

important exceptions: “(1) workplace owner/employer (owner) exercises

controlling and pervasive role over the independent contractor’s work; or (2)

owner assumes affirmative safety duties.” Franks v. Indep. Prod. Co., 96 P.3d 484,

490 (Wyo. 2004). Liability under both exceptions derives from the exercise of

control that is usually absent in the relationship between the owner and an

independent contractor. “Because the [general rule of non-liability] is based on

the owner’s delegation of control to the contractor, it should not apply when the

owner maintains control over the hazard that causes the harm.” Jones, 718 P.2d at

895.

A. Controlling and Pervasive Role

We first consider whether Mid-State (through Welfl) exercised a

“controlling and pervasive role” over Ayrcom’s (Plaintiff’s) work. It is not

enough to exercise the type of control customary in the relationship between an

owner and an independent contractor.

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 [This] exception does not apply unless the employer (owner) has the
right to control the details of the work. The owner may retain a broad
general power of supervision and control as to the results of the work
so as to insure satisfactory performance of the independent
contract—including the right to inspect, the right to stop the work, the
right to make suggestions or recommendations as to details of the
work, the right to prescribe alterations or deviations in the
work—without changing the relationship from that of the owner and
independent contractor or the duties arising from that relationship.

Franks, 96 P.3d at 490 (internal citations and quotation marks omitted). For

liability to arise, the owner must go “beyond making general suggestions or

recommendations [, as by instructing the employees] what to do, how and when to

do it, and what equipment . . . to use.” Natural Gas Processing Co. v. Hull, 886

P.2d 1181, 1186 (Wyo. 1994).

“To determine whether the nature and extent of the control present is

sufficient to impose liability, both applicable contractual provisions and the actual

exercise of control are relevant.” Franks, 96 P.3d at 490. “Although the contract

is not conclusive evidence of the status of the relationship between parties, it is a

strong indication of the associations intended.” Hull, 886 P.2d at 1184.

Mid-State and Ayrcom had no direct contractual relationship. Their

relationship was governed by contracts each had with RT Communications.

Although Mid-State’s contract with RT Communications is not part of the record

on appeal, neither party challenges the district court’s characterization of the

contract. Under its contract with RT Communications, Mid-State was to assist in

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the design and administration of the project, which included providing inspectors

to observe the actual construction and ensure that the installation was completed

according to project specifications. Ayrcom’s contract, in turn, required it “to

provide labor, equipment, and materials” for the project and construct the facilities

“in accordance with . . . specifications and in a safe and workmanlike manner.”

Aplt. App. at 12 ¶ 4; 15 ¶ 11. This contract also specified that RT

Communications’ agent-inspectors lacked any “authority to direct or advise

[Ayrcom] or [its] employees and agents concerning the method or manner by

which the work is to be performed.” Aplt. Br. Att. C at 68. The contract further

required that Ayrcom provide “constant supervision by a competent superintendent

. . . who shall be present at the Project during working hours when construction is

being carried on.” Id. Att. D at 31. RT Communications’ approved engineer

(Mid-State) had the power to recommend to RT Communications that work be

suspended, but could not unilaterally suspend the work without written

authorization from RT. Id. at 32.

Thus, RT Communications retained only the right to inspect and approve

Ayrcom’s work. It could not delegate greater authority to Mid-State. Retaining

such a right of inspection and approval is insufficient to create liability under

Wyoming law. See Jones, 718 P.2d at 896 (reserving “only the right to inspect the

construction work . . . while the independent contractor controls how and when the

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work is to be done . . . is probably not sufficient retained control to subject [the

employer] to liability”).

We thus turn to whether Welfl’s course of conduct amounted to sufficient

assumption of control to create liability. The district court found: (1) Welfl

instructed Plaintiff where to dig and where to place the pipe and other items, but

did not instruct Plaintiff on how to operate the backhoe; (2) he indicated that the

work was completed according to specifications and the trench could be filled; (3)

he instructed Plaintiff to mark the pipe in the bottom of the trench with scare tape;

and (4) he “instruct[ed] Ayrcom employees . . . where to place the remote, pipe

and other items . . . and approved their work, but he did not direct the specific

manner in which those results should be obtained.” Aplt. App. 22 at ¶ 27.

Plaintiff does not challenge as clearly erroneous any of the district court’s

findings of historical fact regarding Welfl’s conduct. Rather, he argues that the

district court erred in determining that Welfl’s conduct did not amount to control

sufficient to create a duty. The existence of a duty in a negligence case is a

question of law. Cockburn v. Terra Res., Inc., 794 P.2d 1334, 1340 (Wyo. 1990);

Jones, 718 P.2d at 894. An interesting question not addressed by the parties,

however, is whether, once the historical facts are found, the determination that the

owner did or did not exercise a “controlling and pervasive role” is a finding of

fact, cf. Restatement (Second) of Torts § 328C(b) & cmt. b (1965) (issue of

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negligence is ordinarily a matter for the jury even when historical facts are

undisputed), or an issue of law. If a finding of fact, we review only for clear

error, Fed. R. Civ. P. 52(a); but if an issue of law, our review is de novo. See

Hays, 105 F.3d at 587. Although the district court labeled its decision a finding of

fact, that label is irrelevant for purposes of appeal. See Featherstone v. Barash,

345 F.2d 246, 250-51 (10th Cir. 1965); 9A Charles Wright & Arthur Miller, Fed.

Prac. & Proc. Civ. 2d § 2579 at 537 (2d ed. 1995) (“An appellate court will regard

a finding or conclusion for what it is, regardless of the label the trial court may put

on it.”). In any event, we need not resolve the matter. Even applying the stricter

de novo standard of review, the district court must be affirmed.

To the extent that Welfl gave explicit instructions—such as direction on

where to bury certain pipes and telling Plaintiff to mark the pipe in the trench with

scare tape—the instructions were incidental to and consistent with his role of

ensuring that the final product of Ayrcom’s work complied with contract

requirements. Liability should not turn on whether an inspector says “the

specifications require that this pipe must be marked,” which undoubtedly does not

constitute the requisite control, or expresses the same message with the functional

equivalent “you need to mark this pipe.” In light of the district court’s

unchallenged findings of historical fact, we affirm its decision that Mid-State did

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not exercise a pervasive and controlling role and hence owed Plaintiff no duty

under that theory of liability.

B. Assumption of Safety Duties

Plaintiff also argues on appeal that Mid-State should have been held liable

because it assumed a duty of safety with respect to Plaintiff. To be liable under

this theory, the owner “must warrant to the independent contractor, either

contractually or as evidenced by its actions, that it has affirmatively assumed

duties of safety.” Dow v. La. Land & Exploration Co., 77 F.3d 342, 345 (10th Cir.

1996) (applying Wyoming law). Neither retaining the right to inspect and approve

the independent contractor’s work nor requiring that the independent contractor

observe a set of safety rules and practices is sufficient to impose liability. Jones,

718 P.2d at 896. See also Franks, 96 P.3d at 491 (merely conducting safety

briefings or stopping work due to safety concerns does not amount to assumption

of affirmative duties for safety).

We reject Plaintiff’s contention that Mid-State assumed the requisite duties

with respect to jobsite safety. No contractual provision created such a duty.

Neither did any conduct by Welfl. Plaintiff suggests that Welfl took on the role of

spotter as Johnson began to fill the trench. But he points to no evidence that Welfl

communicated to Ayrcom’s employees that he was acting as a spotter. Welfl’s

instruction to Plaintiff to attach scare tape to a pipe in the trench was not even an

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implicit assumption of a duty to protect Plaintiff as he performed the task. That

task did not obviously increase the risk to Plaintiff because Ayrcom employees

typically remained in the trench during backfilling and all three workers were

already in the trench when Welfl gave the instruction. (Plaintiff’s brief notes

testimony that Ayrcom’s practice was not to have anyone in the trench during

backfilling, but he fails to argue that the district court’s contrary finding was

clearly erroneous.)

C. Sufficiency of Findings

Finally, we disagree with Plaintiff’s contention that the district court’s

findings were inadequate. To be sure, “findings of fact must be made by the trial

judge as to each and every issue raised by the parties and remaining before him at

the conclusion of the trial.” Woods Constr. Co. v. Pool Constr. Co., 314 F.2d 405,

407 (10th Cir. 1963). But the district court is not required to “make findings as to

every detail.” Nulf v. Int’l Paper Co., 656 F.2d 553, 561 (10th Cir. 1981).

Findings are sufficient “if they indicate the factual basis for the court’s general

conclusion as to ultimate facts and are broad enough to cover all material issues.”

Id. Findings of fact should be “liberally construed in support of a judgment.”

Zack v. Commissioner, 291 F.3d 407, 412 (6th Cir. 2002) (internal quotation marks

deleted). Even “anemic factual findings are not fatal to the decision so long as a

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complete understanding of the issues may be had from the record on appeal.”

Reich v. Newspapers of New England, Inc., 44 F.3d 1060, 1079 (1st Cir. 1995).

The sole alleged shortcoming of the findings raised by Plaintiff on appeal is

the failure to make a “determination as to whether Welfl had assumed a duty of

safety at the time of backfilling.” Aplt. Br. at 19. But there was no reason for the

district court to focus on that issue in its findings because it was not clear that this

was an “issue raised by the parties and remaining . . . at the conclusion of the

trial.” Woods Constr. Co., 314 F.2d at 407. Although during closing argument the

district court speculated on the possibility of Welfl’s assuming that duty, defense

counsel argued that there was no evidence of such assumption, and Plaintiff points

to nothing in the record indicating that his counsel pursued the matter. In this

circumstance, it was sufficient for the court’s findings to recite the court’s view of

what happened and to summarize the extent to which Welfl instructed Plaintiff and

other Ayrcom employees. There was no necessity for the court also to recite

everything that had not happened (such as Welfl’s not affirmatively assuming

safety duties during backfilling), particularly when, as discussed above, no

evidence consistent with the district court’s findings of historical fact supported a

finding of an affirmative assumption of a duty of safety during the backfilling.

The district court’s findings were entirely adequate for purposes of appellate

review.

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The judgment of the district court is AFFIRMED.

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