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Keene v. CNA Holdings, LLC
Citations: 827 S.E.2d 183; 426 S.C. 357Docket: Appellate Case No. 2016-000227; Opinion No. 5625
Court: Court of Appeals of South Carolina; February 12, 2019; South Carolina; State Appellate Court
CNA Holdings, LLC appealed the circuit court's denial of its motions for judgment notwithstanding the verdict (JNOV), new trial absolute, and new trial nisi remittitur in a wrongful death case. The court concluded that Dennis Seay was not a statutory employee of Hoechst Celanese Corporation, as per South Carolina Code section 42-1-400. CNA contended that the circuit court erred in several respects: (1) by not granting a mistrial due to alleged jury misconduct, (2) by admitting a video of Seay in distress, and (3) by affirming the jury's damages award. The facts reveal that Seay worked at the Celanese polyester plant from 1971 to 1980, performing maintenance tasks and handling asbestos materials. After being diagnosed with mesothelioma in 2013, Seay and his wife filed a negligence suit against CNA and others, alleging lack of warning and safety measures regarding asbestos exposure. Seay passed away in December 2014. His daughter later amended the complaint to include wrongful death and survival claims. CNA's motion to dismiss, asserting Seay's status as a statutory employee under the Workers' Compensation Act, was denied. The trial, held in late 2015, resulted in a jury verdict finding Celanese liable for Seay's mesothelioma, awarding $2 million for survival damages, $5 million for wrongful death, $5 million for loss of consortium, and $2 million in punitive damages. Following the trial, CNA's motions were denied, prompting the current appeal. The issues on appeal include the court's decisions regarding Seay's employee status, jury misconduct, the admissibility of the video evidence, and the jury's damage award. The review of the employer-employee relationship for workers' compensation claims is deemed jurisdictional, allowing for a comprehensive examination of the record based on the preponderance of evidence. In the case of Poch v. Bayshore Concrete Products/S.C. Inc., the court emphasizes that the decision to grant or deny a motion for mistrial lies within the trial court's discretion and will not be overturned on appeal unless there is an abuse of discretion, which occurs when a trial court is influenced by an error of law or lacks evidentiary support for its factual conclusions. The admission or exclusion of evidence is similarly at the trial court's discretion, with appellate review contingent upon showing a manifest abuse of discretion that likely resulted in prejudice. Prejudice is assessed based on its probable influence on the jury's verdict in the context of the entire case. Additionally, if a jury's verdict is deemed excessively disproportionate, indicating potential bias or improper considerations, both the trial and appellate courts have the authority to nullify the verdict. However, the jury's assessment of damages is given substantial deference, and a circuit court’s decision regarding a new trial based on damages will only be reversed for manifest legal error. The appellant contends that the circuit court wrongly denied a judgment notwithstanding the verdict (JNOV) regarding Seay's status as a statutory employee of Celanese, asserting that Seay's maintenance work was integral to Celanese's manufacturing operations. The statutory employee doctrine aims to prevent liability evasion by owners and contractors through subcontracting, as established in the Workers' Compensation Act. Owners are liable to pay compensation to any workman employed in work performed by subcontractors, as if the workman were directly employed by them, according to S.C. Code Ann. 42-1-400 (2015). However, the Workers' Compensation Act serves as the exclusive remedy for injured statutory employees, restricting remedies even in the absence of a direct employment relationship. In a recent case, the circuit court found that Celanese's primary business was the manufacture of polyester fibers and determined that maintenance work done by subcontractor employees, such as Seay, was significantly different from Celanese's manufacturing activities. The court applied three tests to assess whether a worker's activity is part of an organization’s trade: 1) if the activity is important to the business, 2) if it is necessary and integral to the business, or 3) if it has been previously performed by the organization's employees. Each case is evaluated on its specific facts without a standard formula, meaning only one of the tests needs to be satisfied. Employees of subcontractors not engaged in work that the owner would typically perform do not establish a statutory employment relationship with the owner. The case centers on the interpretation and impact of two Supreme Court opinions: Abbott v. The Ltd. Inc. and Olmstead, both addressing the concept of statutory employment under South Carolina law, specifically section 42-1-400. In Abbott, a plaintiff delivering goods to a retailer was found not to be the retailer's statutory employee, as the court emphasized that the delivery, while important, was not a part of the retailer's core business operations. Similarly, in Olmstead, the court affirmed that a common carrier employee delivering fiberglass poles for a manufacturer was also not a statutory employee of that manufacturer, despite the delivery’s importance. The court highlighted that the activities involved in both cases did not constitute part of the respective businesses' processes. These rulings represent a shift in South Carolina's legal landscape concerning what constitutes a statutory employee, overruling previous conflicting cases. Respondents contend that this shift applies broadly to all contract workers, while Appellants argue it is limited to transportation scenarios. Regardless of the scope debate, the logic established in Abbott and Olmstead is deemed binding and applicable to the current case, where maintenance work, though essential to manufacturing, was not considered a core part of the manufacturing process. The court concluded that this interpretation aligns with the legislative intent of section 42-1-400, which aims to assess whether a worker's tasks align with the owner’s established business operations, affirming that each case should be evaluated based on its specific facts. Recent precedents are consistent with the analyses in Abbott and Olmstead. In Johnson v. Jackson, the court determined that the plaintiff was a statutory employee of a transportation company specializing in shipping high-value technological equipment. The company had contracted with a temporary employment agency to utilize several workers, including the plaintiff, for loading computers at Palmetto Health for delivery to HP Financial Services. The court distinguished this case from previous cases cited by the plaintiff, noting that transportation was integral to the company's business, which included packaging, loading, and unloading equipment. The court rejected the appellant's argument that prior appellate opinions regarding maintenance workers applied to this case, emphasizing that each case must be evaluated on its own facts rather than relying on a general formula. The appellant referenced Smith v. T.H. Snipes, Sons, Inc., where a self-employed welder was fatally injured while working on a machine used by the defendant. However, the court found the evidence in that case inadequately detailed for comparison. Additionally, the appellant cited Wheeler v. Morrison Mach. Co., involving an asbestos removal contractor, but the court noted that the context of ongoing maintenance by Springs Industries was crucial and not sufficiently analogous to the present case. Asbestos removal at Springs became subject to licensing, prompting the hiring of specialized contractors, although some employees were licensed for emergency removals. The plaintiff was injured during this period, and the court determined that the plaintiff's activities were part of Springs' business. Testimony indicated that the work was essential for maintenance, as asbestos removal was necessary for the project. However, the court referenced the supreme court's decision in Olmstead, which differentiated between activities that are important to a business and those that are integral to its operations. In a subsequent case, Edens v. Bellini, the plaintiff's decedent worked at a textile company’s plant, assisting employees on various projects before a fatal accident. His work on a dye vat project was deemed to satisfy the criteria for statutory employee status, supported by affidavits from his supervisor and a company manager. They confirmed that the decedent's work was directed by the company's employees and was not unique or specialized. Maintaining and modifying operations equipment was characterized as crucial to the defendant's business operations at the plant. The work performed on the door of the dye vat was significant to the defendant's operations in Abbeville and influenced the case outcome favorably for the defendant. However, the court will not automatically accept self-serving affidavits from a party's representative as evidence that an activity is part of the owner's trade or occupation. The determination of the employer-employee relationship for workers' compensation is jurisdictional, requiring the court to review the entire record based on the preponderance of the evidence. The critical factor is whether the activity is part of the owner’s general business. In this case, although Seay's work was important to the manufacturing process, it was not considered part of it, meaning Seay was not a statutory employee of Celanese. Only employees of Daniel performed maintenance and repairs at the Spartanburg plant, while Celanese employees did not engage in this work. A Celanese employee acknowledged that they contracted Daniel for its expertise in construction and maintenance. The circuit court noted that the appellant did not provide evidence supporting the claim that Celanese’s corporate purpose included equipment maintenance. The contracts between Celanese and Daniel explicitly differentiated their work from Celanese's manufacturing operations. Specifically, the contracts state that Daniel would perform maintenance but not operate Celanese's equipment unless explicitly agreed upon. While Celanese reimbursed Daniel for workers' compensation premiums, Daniel was responsible for carrying insurance on its employees. The circuit court concluded, supported by the preponderance of evidence, that Seay was not a statutory employee of Celanese. The appellant claimed that the court erred in denying a mistrial due to alleged jury misconduct involving premature deliberations and outside influences. Juror 16 expressed concerns about a conflict of interest, revealing he worked at the same plant as Seay and performed identical work. Although Juror 16 stated he had not discussed his concerns with other jurors, he later confirmed to the court that he had mentioned his job similarity to the other jurors. The circuit court ultimately excused Juror 16 but denied the motion for a mistrial, stating there was no evidence of jury taint or premature deliberations. The court emphasized that granting a mistrial is an extreme remedy, requiring the moving party to demonstrate both error and resulting prejudice. The circuit court has broad discretion regarding mistrial decisions and juror misconduct assessments, and unless juror misconduct undermines impartiality, it does not typically affect the verdict. A defendant must prove prejudice from jury misconduct to be entitled to a new trial. If allegations of premature jury deliberations arise, the circuit court should hold a hearing to determine if such deliberations occurred and if they were prejudicial. The court may voir dire the jurors and issue a cautionary instruction if necessary. A jury must reach a verdict free of outside influences, and the court assesses whether such influences affected the jury based on factors like the number of jurors exposed, the weight of the evidence, and the effectiveness of curative measures. In this case, the issue of premature deliberations was not raised by the parties but was addressed by the circuit court. After allowing further questioning of Juror 16, the court found no evidence of premature deliberations, noting that a juror was adhering to court instructions. The appellant failed to request a voir dire of the remaining jurors concerning premature deliberations, which led to procedural barring of the issue on appeal, as established in the case of Aldret. The court affirmed the conviction for DUI, concluding there was no evidence of premature deliberations or outside influences affecting the trial. The appellant’s claim that the circumstances surrounding Juror 16's dismissal implied prejudicial information was deemed speculative, as no follow-up questioning was sought. Additionally, the late disclosure of Juror 16's conflict was argued to hinder jury selection rights, but this did not establish actual prejudice. The appellant's argument regarding Juror 16's potential bias was deemed abandoned due to the lack of elaboration or supporting authority, as established in case law. The court emphasized that a mere assertion without argument does not preserve an issue for appeal, and that the appellant had the chance to strike Juror 16 but failed to do so, rendering the argument meritless. Concerning the admission of a video showing Seay in hospice care, the court found no error in its presentation. The video, which depicted Seay in pain and calling for help, was presented without objections at trial until four days later, leading the circuit court to conclude that the appellant waived its right to contest its admission. The court ruled that the video did not unduly prejudice the appellant, as the jury was already aware of Seay's painful condition. The respondents argued that the issue was unpreserved due to the lack of a timely objection, noting the requirement for contemporaneous objections to preserve issues for review. The appellant contended its delay in objecting was due to confusion over the video’s admission, but the court rejected this rationale. Appellant argues that a new trial should be granted due to prejudicial inflammatory arguments, referencing Toyota of Florence, Inc. v. Lynch, which established that a lack of contemporaneous objection can be excused in extreme cases of misconduct. In Toyota, the court condemned the use of inflammatory visual aids that evoked outrage, stating it would be unreasonable for an attorney to foresee such conduct. However, the current case's video evidence did not reach the same level of outrage, leading to a rejection of the argument for excusing the lack of an objection. The document asserts that the admission or exclusion of evidence is within the trial court's discretion, and appellate intervention is justified only when there is a manifest abuse of discretion resulting in probable prejudice. Prejudice is defined as a reasonable probability that the jury's verdict was affected by the improperly admitted or excluded evidence. Appellant contended that the video of Seay, who suffered from mesothelioma, served only to elicit sympathy from the jury, but failed to present this specific argument at trial, limiting the appeal's scope. The court noted that while a party does not need to specify the exact legal doctrine, they must clearly present their argument. Since Appellant did not maintain consistency in their argument from trial to appeal, the claim was deemed unpreserved. Furthermore, the court recognized that mesothelioma is a severe illness that necessitates significant pain management, validating the video’s relevance in demonstrating the extent of Seay’s suffering, which is a compensable element of damages. It concluded that in personal injury cases, evidence relevant to the nature and extent of injuries is broadly admissible, provided it is otherwise competent. Unfair prejudice refers to an undue tendency of evidence to influence a decision on an improper basis, distinct from legitimate damage to a defendant's case caused by the probative value of evidence. The circuit court correctly denied the Appellant's motion for a mistrial, as such a motion is an extreme remedy meant for situations where the prejudicial effect cannot be mitigated otherwise. The moving party carries the burden of proving both error and resulting prejudice. Mistrial decisions are at the circuit court's discretion and will not be overturned without clear evidence of abuse. Regarding the request for a new trial due to excessive damages, the court found no basis for granting such a motion. A verdict may only be set aside if it is grossly excessive and indicates jury bias. The appropriateness of unliquidated damages relies on the specifics of each case and is assessed favorably towards the plaintiff. The jury's damage award is given substantial deference, and appellate courts will not disturb the circuit court's discretion unless a manifest legal error is evident. In this case, the jury awarded significant compensatory damages to Seay's estate for the survival claim and wrongful death claim, as well as punitive damages for Celanese's willful misconduct. The circuit court substantiated the $2 million survival claim through evidence of Seay's medical procedures and suffering, while the $5 million awards for wrongful death and loss of consortium were supported by testimonies reflecting the impact of Seay's death on his family. Any individual may initiate a lawsuit for damages resulting from the intentional or wrongful infringement of their right to companionship, aid, and society from a spouse, as indicated in S.C. Code Ann. 15-75-20 (2005) and supported by Welch, 342 S.C. at 304. In wrongful death actions, damages focus on the beneficiaries' losses rather than the value of the deceased's life, encompassing 1) pecuniary loss, 2) mental shock and suffering, 3) wounded feelings, 4) grief and sorrow, 5) loss of companionship, and 6) deprivation of the deceased’s societal benefits, including their experience and judgment. Regarding punitive damages, the circuit court assessed the extensive knowledge Celanese had about the dangers of asbestos, noting its continued use despite this awareness. The purpose of punitive damages includes punishing the wrongdoer, deterring similar future conduct, and vindicating the rights of the injured party. The court found no excessive punitive damages in light of comparisons to other mesothelioma cases and the statutory cap set by S.C. Code Ann. 15-32-530 (Supp. 2018), which limits punitive awards to a maximum of three times the compensatory damages or $500,000, whichever is greater. On appeal, the appellant claimed that the jury's decision was influenced by extraneous factors, including premature deliberations and an improper video presentation. However, the appellant did not demonstrate that these factors affected the verdict, and the video depicting the plaintiff's suffering was deemed necessary for conveying the extent of pain. Additionally, the appellant acknowledged the existence of higher awards in similar cases, and evidence supported the damages awarded, with stipulated medical expenses amounting to $280,457.91. Seay underwent significant medical treatment due to his condition, having fluid drained from his lungs 11 times and undergoing three lung surgeries. He faced complications such as a temporary inability to breathe from collapsed lungs, was hospitalized for dehydration three times, and struggled with constant pain and ineffective pain medication. Chemotherapy exacerbated his illness, leading to an inability to keep food down, and he reported emotional distress from his terminal diagnosis of "asbestos cancer," which left him with a prognosis of 12 to 18 months to live. His family provided testimonies highlighting the emotional impact of his illness and subsequent death. Evidence presented indicated that Celanese was aware of the risks associated with asbestos exposure, as shown by a 1970 toxicology report linking mesothelioma to even slight exposure, and a 1930 study recommending protective measures for workers. However, Seay was never warned about the dangers of asbestos or provided with protective gear. Additionally, there was a "culture of concealment" at Celanese, as indicated by internal memos suggesting minimal documentation regarding hazardous materials and promoting a misleading narrative about the safety of asbestos exposure. The circuit court affirmed the damages awarded, finding them supported by evidence and not excessive. The court also referenced statutory provisions that limit an employee's rights against an employer concerning workplace injuries. The decision was unanimously affirmed by the judges involved. The court determined that the defendant's "trade or business" did not include the plaintiff’s installation of an electrical system at a plant under construction for the defendant. The defendant's involvement in multiple construction projects did not signify the establishment of a construction division nor did it indicate that construction work was performed by its regular employees. Relevant legal precedents indicate that statutory employment applies only when the work aligns with tasks the employer would typically perform through its employees. The circuit court correctly referenced prior cases—specifically Glass and Raines—where similar conclusions were reached, emphasizing that each case must be evaluated based on its unique facts. During jury selection, the circuit court did not specify the plant where the plaintiff, Seay, worked or his job responsibilities but inquired about jurors’ connections to related companies. A juror revealed a connection to Auriga Polymers, formerly Celanese, but all jurors confirmed their ability to remain impartial. Additionally, the appellant's counsel expressed concern that he was not informed in advance that a video presented during trial included audio and a reference to Jesus, noting his delayed objection was due to an assumption that the video was approved by another defense team member.