Hospital denied summary disposition where employee falls in parking structure run by hospital subsidiary
Maureen Lefevre works for St. John Hospital and Medical Center. She fell on ice in the Hospital parking structure and suffered a severe injury. Because the parking structure is operated by and leased to Affiliated Health Services and not her employer, she filed suit against Affiliated for negligence in failing to take reasonable steps to clear the ice where she fell. The hospital argued that since both the Hospital and Affiliated are wholly-owned subsidiaries of St. John Health, it should be considered Lefevre's employer for purposes of the exclusive remedy provision of the worker's compensation statute.On the basis of the exclusive remedy provision, St. John's argued that Lefevre should be limited to the partial pay and medical expense recovery she received from the Hospital, regardless of St. John's active negligence. This is called the "have your cake and eat it, too" argument: part of the fairly recent F"edEx Ground doctrine" that allows corporate employers to pick and choose among the laws they comply with. When recognized by the Courts, it allows corporations to derive the benefits of separate corporate existence, while avoiding any of the disadvantages that would be associated. In this case, that means the other "subsidiaries" are not treated as Lefevre's employer for any of the purposes that would benefit her, such as ERISA rights, for example, but they may be her "employer" if they derive protection from that status.
Faced with two opposing historical decisions reaching opposite conclusions, the Court of Appeals determined that Lefevre was not limited to the exclusive workers compensation remedy because St. Johns had not documented that it and Affiliated were Lefevre's employer under the economic reality test. To gain the benefit of the exclusive remedy provision, St. Johns must prove, in essence, that it controlled Lefevre's duties, paid her wages, enjoyed the right to hire, fire or discipline her, and that her duties were an inherent part of St. Johns' business. While it is possible that St. Johns is the de facto employer of all of its subsidiaries' employees, those proofs had not yet been established in Lefevre's case.
The Court also rejected St. Johns' remaining arguments for summary disposition. It held that Lefevre's attorneys had created a question of fact with regard to whether St. John should have known of the presence of the ice, by producing weather documentation showing that the ice had probably been present long enough to be discovered and addressed by St. Johns. Further, it noted that the Supreme Court has refused to apply the "open and obvious" defense to falls on so-called black ice, where, as here, its presence is not betrayed by an accumulation of snow.