California Court of Appeal, Yaffee v. Skeen, Docket No. C097746

Hospital Lien Act (HLA)

 

Lien Upon the Damages Recovered

 

Workers’ Compensation

 

California Law

 

 

 

 

With the HLA, “the Legislature established one mechanism through which hospitals that provide emergency services can recoup costs from an entity other than a patient’s health care service plan.” (Dameron Hospital Assn. v. AAA Northern California, Nevada & Utah Ins. Exchange (2022) 77 Cal.App.5th 971, 985.) Section 3045.1 states, every person or entity “maintaining a hospital licensed under the laws of this state which furnishes emergency and ongoing medical or other services to any person injured by reason of an accident or negligent or other wrongful act not covered by workers’ compensation shall, if the person has a claim against another for damages on account of his or her injuries, have a lien upon the damages recovered, or to be recovered, by the person... to the extent of the amount of the reasonable and necessary charges of the hospital and any hospital affiliated health facility, as defined in Section 1250 of the Health and Safety Code, in which services are provided for the treatment, care, and maintenance of the person in the hospital or health facility affiliated with the hospital resulting from that accident or negligent or other wrongful act.”

 

 

When a hospital receives payment from a patient and his health insurer at a reduced negotiated rate under a prior agreement in which the hospital agreed to accept that payment as “payment in full” for its services, the hospital cannot assert a lien under the HLA to “recover the difference between its usual and customary charges and the amount received from the patient and his insurer.” (Parnell, supra, 35 Cal.4th at p. 598.) (Parnell v. Adventist Health System/West (2005) 35 Cal.4th 595, 604.) However if, “hospitals wish to preserve their right to recover the difference between usual and customary charges and the negotiated rate through a lien under the HLA, they are free to contract for this right” when negotiating their contracts with insurers. (Dameron Hospital Assn. v. AAA Northern California, Nevada & Utah Ins. Exchange (2014) 229 Cal.App.4th 549, 554.)

 

 

We agree with defendants that the plain language of section 3045.1 requires a hospital to provide emergency services before the hospital can assert a lien under the HLA, and to the extent the trial court found otherwise, it erred.

 

 

(…) Thus, the Legislature contemplated the amendments would cover nonemergency services that flow from the provision of emergency services when patients remain in the hospital.

 

 

(…) The issue in Parnell was whether a hospital could assert a lien under the HLA to recover the difference between its usual and customary charges and the amount received from a patient and its insurer when the hospital had agreed to accept the amount the patient and insurer paid as “payment in full” for its services. (Id. at p.598.) Our Supreme Court concluded the hospital could not. (Ibid.)

 

 

 

 

 

(California Court of Appeal, Dec. 17, 2024, Yaffee v. Skeen, Docket No. C097746, Certified for Publication)

 

 

 

California Court of Appeal, 3 Stonedeggs, Inc. v. Workers’ Compensation Appeals Board and Braden Nanez, C098711

Workers’ Compensation Law

 

Commercial Traveler Rule

 

California Law

 

 

 

Under the “commercial traveler” rule in workers’ compensation law, an employee traveling on the employer’s business is regarded as acting within the course of employment during the entire period of travel. (LaTourette v. Workers’ Comp. Appeals Bd. (1998) 17 Cal.4th 644, 652 (LaTourette).) As a result, workers’ compensation coverage applies to injuries the employee sustains during the travel itself and during the course of other personal activities “reasonably necessary for the sustenance, comfort, and safety of the employee,” such as procuring food and shelter. (Ibid.) However, personal activity not reasonably contemplated by the employer may constitute a material departure from the course of employment. (Ibid.)

 

 

In this matter, respondent Workers’ Compensation Appeals Board (the Board) determined that under the commercial traveler rule, workers’ compensation coverage applied to injuries respondent Braden Nanez sustained in an auto accident while he was off work and away from his job at a remote fire base camp. The employer, petitioner 3 Stonedeggs, Inc., expected employees not to leave the job site and to notify a manager if they did. Nanez did not notify a manager he was leaving camp. Rescinding the findings of the administrative law judge, the Board found that Nanez’s use of his own car while off work to drive approximately 70 miles away from camp purportedly to obtain cellular service was conduct reasonably expected by his employer to be incident to its requirement that Nanez spend time away from home where cellular service was not adequately provided at the camp. The Board concluded that Nanez’s travel was for comfort and leisure and was not a distinct departure from his employment.

 

 

The employer is a mobile food service that contracts with the U.S. Forest Service to provide meals for firefighters and supporting personnel. Nanez, 19 years of age, began working for the employer as a food service worker on September 11, 2020, at a fire camp in Brownsville, California.

 

 

The Board agreed with Nanez and rescinded the ALJ’s opinion. In an opinion and decision dated February 15, 2023, the Board determined that the commercial traveler rule applied to Nanez’s claim. The Board explained, “Because the employer (1) allowed applicant to travel by his own car from the Brownsville camp to his Chico home and then return to continue his work there; (2) sought and obtained applicant’s agreement to travel to Happy Camp on its business; (3) authorized applicant to travel to Happy Camp using his own car; and (4) did not instruct applicant to refrain from using his own car during his off hours or for personal reasons, applicant’s conduct in using his own car during his off hours to drive from Happy Camp to Yreka was conduct reasonably expected by the employer to be incidental to its requirement that he spend time away from home.” Also, because the record did not disclose Nanez’s reasons for traveling to Yreka other than, in the Board’s words, Todd’s “surmise” that it was to use his cell phone, and because Nanez traveled during his off hours and between shifts, the record suggested that Nanez’s travel was for comfort or leisure and was not a distinct departure from his employment. The Board also found that the evidence did not establish that Nanez’s claim was barred by the defense of intoxication.

 

 

To receive workers’ compensation, the injured employee must prove by a preponderance of the evidence that his injury arose out of and was in the course of employment. (LaTourette, supra, 17 Cal.4th at p.650; Lab. Code, §3600.) In applying this two-pronged requirement, we are to construe it liberally in favor of awarding benefits. (LaTourette, at pp.650-651.)

 

 

The first prong, “in the course of employment,” ordinarily refers to the time, place, and circumstances under which the injury occurred. (LaTourette, supra, 17 Cal.4th at p.651.) “Thus ‘“an employee is in the ‘course of his employment’ when he does those reasonable things which his contract with his employment expressly or impliedly permits him to do.”’” (Ibid.) The second prong, “arising out of employment,” concerns whether the injury occurred by reason of a condition or incident of the employment. (LaTourette, supra, 17 Cal.4th at p.651.) In other words, “‘the employment and the injury must be linked in some causal fashion.’” (Ibid.) This causation element requires only “‘“that the employment be one of the contributing causes without which the injury would not have occurred.”’” (Id., at fn.1.) The mere fact an employee during working hours is performing a personal act when injured does not per se preclude him from compensation. (LaTourette, supra, 17 Cal.4th at p.651.) If the particular act is reasonably contemplated by the employment, injuries received while performing that act arise out of the employment and are compensable. (Ibid.) Generally, an employee commuting to and from a fixed place of business at fixed hours is not considered to be acting within the scope of his employment. Under the so-called going and coming rule, injuries suffered during the ordinary local commute are not compensable. (Hinojosa v. Workmen’s Comp. Appeals Bd. (1972) 8 Cal.3d 150, 157.) That is because the employment plays no special role in the need for transportation other than the normal need of the employees’ presence to perform their work. (Ibid.) The commercial traveler rule is an exception to the going and coming rule. (Jeewarat v. Warner Bros. Entertainment Inc. (2009) 177 Cal.App.4th 427, 437.) Under the rule, employees “‘whose work entails travel away from the employer’s premises are held ... to be within the course of their employment continuously during the trip, except when a distinct departure on a personal errand is shown.’” (IBM Corp. v. Workers’ Comp. Appeals Bd. (1978) 77 Cal.App.3d 279, 282 (IBM Corp.).) Workers’ compensation coverage “applies to the travel itself and also to other aspects of the trip reasonably necessary for the sustenance, comfort, and safety of the employee.” (LaTourette, supra, 17 Cal.4th. at p.652.) A traveling employee “could hardly be expected to remain holed up in his hotel room.” (Fleetwood Enterprises, Inc. v. Workers’ Comp. Appeals Bd. (2005) 134 Cal.App.4th 1316, 1327.) The commercial traveler rule “does not, however, apply to any and all activities. ‘Personal activity not contemplated by the employer may constitute a material departure from the course of employment.’” (LaTourette, supra, 17 Cal.4th. at p.652.) The activity must bear some relation to the purposes of the employment. (Id. at p.653.)

 

 

No party cites to reported case law or other Board decisions that explain how to determine whether the employee is a commercial traveler or is rather on a “quasi-permanent” assignment, and we have found none. To us, a useful approach arises by recognizing that the commercial traveler rule is an exception to the going and coming rule. That rule precludes compensation where the injury occurs during the employee’s ordinary, daily, local commute to and from his fixed place of employment at fixed hours and in the absence of special or extraordinary circumstances. (Hinojosa, supra, 8 Cal.3d at p.157.) It excludes from coverage “the ordinary, local commute that marks the daily transit of the mass of workers to and from their jobs; the employment, there, plays no special role in the requisites of portage except the normal need of the presence of the person for the performance of the work.” (Ibid.)

 

 

(…) Even intentional or criminal misconduct that occurs within the course of one’s employment and causes injury does not necessarily preclude recovering benefits. (Westbrooks, supra, 203 Cal.App.3d at p.254.) “Any employer could argue that reckless, intentional, or criminal conduct is not part of any job description and therefore not within the scope of employment. This argument, however, if permitted to succeed, would totally undermine the no-fault foundation of workers’ compensation law.” (Ibid.)

 

 

 

 

 

 

(California Court of Appeal, May 24, 2024, 3 Stonedeggs, Inc. v. Workers’ Compensation Appeals Board and Braden Nanez, C098711, Certified for Publication)

U.S. Court of Appeals for the Ninth Circuit, Corby Kuciemba v. Victory Woodworks, Inc., Docket No. 21-15963

Labor Law

 

Tort Law

 

Negligence

 

Duty of Care

 

Failure to Protect Employees

 

California’s Derivative Injury Doctrine

 

California Workers’ Compensation Act

 

California Law

 

 

If an employee contracts COVID-19 at his workplace and brings the virus home to his spouse, does California’s derivative injury doctrine bar the spouse’s claim against the employer?

 

Under California law, does an employer owe a duty to the households of its employees to exercise ordinary care to prevent the spread of COVID-19?

 

 

 

 

Appeal from the United States District Court for the Northern District of California.

 

 

 

 

The panel affirmed the district court’s dismissal of a diversity action brought by Robert Kuciemba and his wife Corby Kuciemba against Mr. Kuciemba’s employer Victory Woodworks, alleging that Mrs. Kuciemba contracted a severe case of COVID-19 from Mr. Kuciemba as a result of Victory’s negligent failure to protect its employees from the virus. The panel certified two questions to the Supreme Court of California, which accepted certification and held that (1) California’s derivative injury doctrine—under which workers’ compensation benefits generally provide the exclusive remedy for third party claims if the asserted claims are collateral to or derivative of the employee’s workplace injury—did not bar Mrs. Kuciemba’s tort claims against Victory; but (2) an employer does not owe a duty of care under California law to prevent the spread of COVID-19 to employees’ household members. Because Victory owed no duty of care to Mrs. Kuciemba, the panel affirmed the district court’s order dismissing the complaint.

 

 

The Kuciembas sued Victory in Superior Court in California. They alleged that Victory’s violations of federal, state, and municipal regulations and its failure to protect its employees from COVID-19 substantially caused Mrs. Kuciemba’s severe infection. Mrs. Kuciemba brought claims for negligence, negligence per se, and premises liability, and Mr. Kuciemba brought a claim for loss of consortium. Victory removed the case to federal court and filed a motion to dismiss. The district court granted Victory’s motion, holding that California’s derivative injury doctrine barred the Kuciembas’ claims and that an employer’s duty to provide a safe workplace to employees does not extend to nonemployees sickened by a virus outside of the employer’s premises.

 

 

Following briefing and argument, we concluded that no controlling precedent resolved whether the derivative injury doctrine barred Mrs. Kuciemba’s claims and whether Victory owed Mrs. Kuciemba a duty of care. We further determined that a decision by the Supreme Court of California could control the outcome and that this appeal presents issues of significant importance for the State of California, including the scope of an employer’s tort liability for the spread of COVID-19. We requested that the Supreme Court of California decide two certified questions:

 

If an employee contracts COVID-19 at his workplace and brings the virus home to his spouse, does California’s derivative injury doctrine bar the spouse’s claim against the employer?

 

Under California law, does an employer owe a duty to the households of its employees to exercise ordinary care to prevent the spread of COVID-19? 

 

 

The Supreme Court of California granted our request and has now issued its decision.

 

 

As to the first question, the Supreme Court of California held that California’s derivative injury doctrine—under which workers’ compensation benefits generally “provide the exclusive remedy for third party claims if the asserted claims are ‘collateral to or derivative of’ the employee’s workplace injury”—does not bar Mrs. Kuciemba’s tort claims. Kuciemba v. Victory Woodworks, Inc., No. S274191, 2023 WL 4360826, at *3– 9 (Cal. July 6, 2023). The court explained that most derivative injury claims seek recovery for losses sustained because of “a loved one’s disability or death, rather than for the plaintiff’s own physical injuries or death.” Id. at *6. Mrs. Kuciemba’s negligence claims, however, “are not legally or logically dependent” on an injury Mr. Kuciemba sustained at work. Id. at *9. The “‘but for’ causal link” between Mrs. Kuciemba’s injury and Mr. Kuciemba’s COVID-19 exposure is therefore “insufficient, on its own, to render the claims derivative.” Id. Thus, the claims are not barred by the exclusivity provisions of the California Workers’ Compensation Act. Id. The Supreme Court of California held as to the second question that “an employer does not owe a duty of care under California law to prevent the spread of COVID-19 to employees’ household members.” Id. at *21. The analysis of the court is detailed and bears reading with respect to California tort law. To begin, the court held that “the default rule of duty applies in the COVID-19 context as well where plaintiffs have alleged that the defendant, through its own actions, created an unreasonable risk of the disease’s transmission.” Id. at *12.

 

 

Although California “Civil Code section 1714 articulates a general duty of care,” compelling policy considerations can support exceptions. Id. at *13. The court pointed to Rowland v. Christian, 443 P.2d 561 (1968), as identifying “several considerations that may, on balance, justify a departure from Civil Code section 1714’s default rule of duty.” Id. Such considerations include, among others, the foreseeability of harm to the plaintiff, the moral blame attached to the defendant’s conduct, the policy of preventing future harm, and the extent of the burden to the defendant and consequences to the community of imposing a duty to exercise care with resulting liability for breach. Id. The court identified foreseeability as “the most important factor to consider in determining whether to create an exception to the general duty to exercise ordinary care” under section 1714. Id. at *14 (quoting Kesner v. Superior Court, 384 P.3d 283, 291 (Cal. 2016)). On this point, the court concluded that “it is plainly foreseeable that an employee who is exposed to the virus through his employer’s negligence will pass the virus to a household member.” Id. at *16. The court also concluded that the “moral blame factor weighs in favor of establishing a duty” primarily because Victory had greater access to knowledge and control to prevent the spread of COVID-19 on its premises than did the plaintiffs. Id. at *17. Despite its conclusions with respect to foreseeability and moral blame, the court wrote that “while the foreseeability factors and the policy factor of moral blame largely tilt in favor of finding a duty of care, the policy factors of preventing future harm and the anticipated burdens on defendants and the community weigh against imposing such a duty.” Id. at *20. Important to this analysis of the Rowland factors was the recognition that “some factors may be so weighty as to tip the balance one way or the other.” Id. The court went on to conclude: Here, the significant and unpredictable burden that recognizing a duty of care would impose on California businesses, the court system, and the community at large counsels in favor of an exception to the general rule of Civil Code section 1714. Imposing on employers a tort duty to each employee’s household members to prevent the spread of this highly transmissible virus would throw open the courthouse doors to a deluge of lawsuits that would be both hard to prove and difficult to cull early in the proceedings. Id. With these considerations in mind, the court concluded that “‘the burden to the defendant and consequences to the community’ weigh against imposing a duty of care” here. Id. at *19. As a consequence, because Victory owed no duty to Mrs. Kuciemba, we affirm the district court’s dismissal of the Kuciembas’ First Amended Complaint.

 

 

 

 

(U.S. Court of Appeals for the Ninth Circuit, July 25, 2023, Corby Kuciemba v. Victory Woodworks, Inc., Docket No. 21-15963, For Publication)