Richard C. Polley
G. Bordas, Jr.
Dickie, McCamey & Chilcote, L.C. James B. Stoneking
Wheeling, West Virginia Bordas, Bordas & Jividen
George N. Stewart Wheeling, West Virginia
Dara A. DeCourcy Attorneys for the Appellees
Zimmer Kunz, P.L.L.C.
Attorneys for the Appellant
JUSTICE DAVIS delivered the Opinion of the Court.
CHIEF JUSTICE MCGRAW dissents and reserves the right to file a dissenting opinion.
1. 'A trial judge's decision
to award a new trial is not subject to appellate review unless the trial judge
abuses his or her discretion.' Syl. Pt. 3, in part, In re State Public Bldg.
Asbestos Litigation, 193 W. Va. 119, 454 S.E.2d 413 (1994), cert.
denied sub nom. W.R. Grace & Co. v. West Virginia, 515 U.S. 1160, 115
S. Ct. 2614, 132 L. Ed. 2d 857 (1995). Syllabus point 2, State
v. Vance, 207 W. Va. 640, 535 S.E.2d 484 (2000).
2. 'It takes a
stronger case in an appellate court to reverse a judgment awarding a new trial
than one denying it and giving judgment against the party claiming to have been
aggrieved. Point 1, Syllabus, The Star Piano Co. v. Brockmeyer,
78 W. Va. 780 [, 90 S.E. 338 (1916)].' Syl. pt. 2, Young v. Duffield,
152 W. Va. 283, 162 S.E.2d 285 (1968). Syllabus point 1, In re
State Public Building Asbestos Litigation, 193 W. Va. 119, 454 S.E.2d
3. Where the issue on an appeal from the circuit court is clearly a question of law or involving an interpretation of a statute, we apply a de novo standard of review. Syllabus point 1, Chrystal R.M. v. Charlie A.L., 194 W. Va. 138, 459 S.E.2d 415 (1995).
4. 'The general rule is that where one person has contracted with a competent person to do work, not in itself unlawful or intrinsically dangerous in character, and who exercise no supervision or control over the work contracted for, such person is not liable for the negligence of such independent contractor or his servants in the performance of the work.' Syl. Pt. 1, Chenoweth v. Settle Eng'rs, Inc., 151 W. Va. 830, 156 S.E.2d 297 (1967), overruled in part on other grounds by Sanders v. Georgia Pacific Corp., 159 W. Va. 621, 225 S.E.2d 218 (1976). Syllabus point 7, Thomson v. McGinnis, 195 W. Va. 465, 465 S.E.2d 922 (1995).
5. A principal has a
non-delegable duty to exercise reasonable care when performing an inherently
dangerous activity; a duty that the principal cannot discharge by hiring an
independent contractor to undertake the activity. Syllabus point 2, King
v. Lens Creek Ltd. Partnership, 199 W. Va. 136, 483 S.E.2d 265 (1996).
6. Collateral estoppel
is designed to foreclose relitigation of issues in a second suit which have
actually been litigated in the earlier suit even though there may be a difference
in the cause of action between the parties of the first and second suit. We
have made this summary of the doctrine of collateral estoppel:
'But where the causes of action are not the same, the parties being identical or in privity, the bar extends to only those matters which were actually litigated in the former proceeding, as distinguished from those matters that might or could have been litigated therein, and arises by way of estoppel rather than by way of strict res adjudicata.' Lane v. Williams, 150 W. Va. 96, 100, 144 S.E.2d 234, 236 (1965).
Syllabus point 2, Conley v. Spillers, 171 W. Va. 584, 301 S.E.2d 216 (1983).
7. 'The doctrine of collateral
estoppel also requires as does res judicata that the first judgment be
rendered on the merits and be a final judgment by a court having competent jurisdiction
over the subject matter and the parties.' Syl. Pt. 3, Conley v. Spillers,
171 W. Va. 584, 301 S.E.2d 216 (1983). Syllabus point 2, Christian
v. Sizemore, 185 W. Va. 409, 407 S.E.2d 715 (1991).
8. 'A fundamental due
process point relating to the utilization of collateral estoppel is that any
person against whom collateral estoppel is asserted must have had a prior opportunity
to have litigated his claim.' Syl. Pt. 8, Conley v. Spillers, 171 W. Va.
584, 301 S.E.2d 216 (1983). Syllabus point 3, Christian v. Sizemore,
185 W. Va. 409, 407 S.E.2d 715 (1991).
9. Where a party is sued on
a theory of vicarious liability arising from the negligence of an independent
contractor, that party is entitled to defend on the basis that the independent contractor was not negligent, notwithstanding the entry
of a default judgment against the independent contractor. However, the default
judgment against the independent contractor remains in full force and effect
regardless of the outcome of the litigation on the issue of his or her negligence.
Colaianni Construction, Inc., appeals from an order of the Circuit Court of Ohio County granting a new trial in this wrongful death/personal injury action. Colaianni Construction had been sued on a theory of vicarious liability arising from the alleged negligence of an independent contractor against whom a default judgment was ultimately entered. In granting a new trial, the circuit court reasoned that, because the negligence of the independent contractor had been determined by virtue of the default judgment, it had erred by allowing the jury to decide that question. Consequently, the circuit court ruled that in the new trial Colaianni would be precluded from litigating the issue of the independent contractor's negligence. We conclude that a default judgment is not a proper foundation for the application of offensive collateral estoppel. Therefore, the question of the independent contractor's negligence was properly before the jury. For this reason, we reverse this case and remand for entry of an order reinstating the jury verdict.
In approximately 1990 or 1991, the City of Wheeling
removed the lights from the banner flag poles; however, electrical service to
the dock area was left in tact. At some point, the navigation lights were also
removed. Again, electrical service to the dock area remained in tact.
Thereafter, the dock area was flooded in 1996. As
a result of the flood, the electrical/breaker room from which electrical service
to the dock area was provided sustained damage. The City hired Yahn Electric,
Inc. to perform repair work. Yahn Electric replaced all the breakers in the electrical/breaker room, including
those that powered the lines to the flag poles in the dock area. Apparently,
there was no inspection of the conduit below the dock that carried the electrical
lines to the flag poles.
It was later learned that this conduit had deteriorated
and dislodged, and had come to rest on the river bed. As a result of this damage,
several live wires were exposed in the water of the Ohio River. On August 2,
1997, prior to the discovery of this damage and the exposed wires, Adaline Stillwell,
a plaintiff below and an appellee herein, and her fourteen-year-old daughter
Susan were tubing on the Ohio River in the vicinity of the amphitheater, a public
area commonly used for such recreational activities. As Adaline Stillwell approached
the dock she began to feel tingling and numbness in her legs and was pulled
from the water. In the meantime, Susan also reached the dock area. Before Susan
was able to get out of the water, however, she came into contact with the exposed
electrical wires that were energizing the water and was electrocuted. Efforts
to resuscitate her were unsuccessful and she was later pronounced dead at Wheeling
Adaline Stillwell, as administrator of the estate
of the deceased, and in her own right, filed a wrongful death and personal injury
suit in the Circuit Court of Ohio County. The defendants named in the suit included
the City of Wheeling; McKinley & Associates, Inc., f/k/a McKinley Engineering
Company; Colaianni Construction, Inc.; and Young Electric, Inc.See footnote 2 2
Susan's father, Alvin Stillwell,See
footnote 3 3 also filed a wrongful death suit in the Circuit
Court of Ohio County in his capacity as the administrator of Susan's estate.See
footnote 4 4 Alvin Stillwell's suit was asserted against the
same defendants named in Adaline Stillwell's suit. Colaianni filed a motion
to dismiss as duplicative the action filed by Alvin Stillwell. The circuit court
then made Adaline and Alvin Stillwell (hereinafter the Stillwells)
co- administrators of Susan's estate and directed a single trial.See
footnote 5 5 Yahn Electric, Inc., was added to the suit as a
Young did not file an answer or otherwise appear in
this action.See footnote 6 6
Due to Young's failure to respond, the Stillwells moved for a default judgment
under Rule 55 of the West Virginia Rules of Civil Procedure. The motion was
granted over Colaianni's objection. In addition to obtaining a default judgment
against Young, the Plaintiffs negotiated settlements with the City of Wheeling,
McKinley & Associates, Inc., and Yahn Electric. The circuit court approved the settlements, also over Colaianni's
A jury trial was then had with Colaianni as the only
remaining defendant. After hearing the evidence presented, the jury returned
a verdict finding that neither Young nor Colaianni had been negligent in installing
the electrical system at the amphitheater. In addition, however, the jury concluded
that Young's work in this regard was inherently dangerous.See
footnote 7 7
Following the return of the jury verdict, the Stillwells
filed a motion for a new trial claiming, in part, that the circuit court should
have entered judgment against Colaianni as a matter of law following the default
by its subcontractor, Young. The circuit court then set aside the verdict and
granted the Stillwells a new trial. In its order granting a new trial, the circuit
Based upon [the jury's finding that the work being performed by Young Electric was inherently dangerous], the negligence of the defendant, Young Electric Company, Inc., as subcontractor, was imputed to the defendant, Colaianni Construction, Inc., as general contractor, under the principles set forth in King v. Lens Creek Limited Partnership, 199 W. Va. 136, 483 S.E.2d 265 (1996).
The circuit court then concluded that it had erred in submitting to the jury the issue of Young's negligence. Allowing the verdict to stand, the court reasoned, would result in a miscarriage of justice. Consequently, the circuit court ordered at new trial and directed that the issues to be addressed would be only: (1) Colaianni's negligence, (2) the inherent dangerousness of Young Electric's work, and (3) damages. It is this order that Colaianni now appeals.See footnote 8 8
[a]lthough the ruling of a trial court in granting
or denying a motion for a new trial is entitled to great respect and weight, the
trial court's ruling will be reversed on appeal when it is clear that the trial
court has acted under some misapprehension of the law or the evidence.
Andrews, 201 W. Va. at 630, 499 S.E.2d at 852 (quoting Syl. pt. 4, Sanders v. Georgia-Pac. Corp., 159 W. Va. 621, 225 S.E.2d 218 (1976) (additional citations omitted)).
Our determination of whether the circuit court abused
its discretion in the case sub judice requires us to decide the issue
of whether a general contractor being sued on a theory of vicarious liability
is barred from litigating the issue of an independent contractor's negligence
where a default judgment has been entered against the independent contractor.
To the extent that this raises a question of law, our review of the circuit
court's determination of this particular issue is de novo. Where
the issue on an appeal from the circuit court is clearly a question of law or
involving an interpretation of a statute, we apply a de novo standard
of review. Syl. pt. 1, Chrystal R.M. v. Charlie A.L., 194 W. Va.
138, 459 S.E.2d 415 (1995). Having reviewed the proper standards for our consideration
of this case, we now address the issue at hand.
The doctrine of collateral estoppel applies to preclude
the litigation of an issue that has been previously resolved. See
Christian v. Sizemore, 185 W. Va. 409, 412, 407 S.E.2d 715, 718
(1991) (Collateral estoppel is essentially a doctrine which precludes
the relitigation of an issue, while res judicata precludes relitigation
of the same cause of action. (emphasis added)). The circuit court's decision
to award a new trial in which Colaianni would be precluded from litigating the
issue of Young's negligence is an application of offensive collateral estoppel.
Conley v. Spillers, 171 W. Va. 584, 591, 301 S.E.2d 216, 222 (1983)
(Where a plaintiff presses for collateral estoppel, it is said to be 'offensive'
on the theory that the plaintiff is using the estoppel as an affirmative device
to avoid having to prove liability against the defendant.). We have explained:
Collateral estoppel is designed to foreclose relitigation of issues in a second suit which have actually been litigated in the earlier suit even though there may be a difference in the cause of action between the parties of the first and second suit. We have made this summary of the doctrine of collateral estoppel:
But where the causes of action are not the same, the parties being identical or in privity, the bar extends to only those matters which were actually litigated in the former proceeding, as distinguished from those matters that might or could have been litigated therein, and arises by way of estoppel rather than by way of strict res adjudicata. Lane v. Williams, 150 W. Va. 96, 100, 144 S.E.2d 234, 236 (1965).
Syl. pt. 2, Conley.See footnote 10 10
In discussing the requisites for the application of
collateral estoppel, we have further stated:
The doctrine of collateral estoppel also requires as does res judicata that the first judgment be rendered on the merits and be a final judgment by a court having competent jurisdiction over the subject matter and the parties. Syl. Pt. 3, Conley v. Spillers, 171 W. Va. 584, 301 S.E.2d 216 (1983).
Syl. pt. 2, Christian. There is no question that a default judgment is equivalent to a final judgment on the merits. See Blake v. Charleston Area Med. Ctr., Inc., 201 W. Va. 469, 478, 498 S.E.2d 41, 50 (1997) (concluding that the default ruling in the initial case between CAMC and the Blakes satisfies the criteria for a final adjudication on the merits by a court of competent jurisdiction. (citations omitted)); Syl. pt. 1, in part, Intercity Realty Co. v. Gibson, 154 W. Va. 369, 175 S.E.2d 452 (1970) (A default judgment obtained in accordance with the provisions of Rule 55(b), West Virginia Rules of Civil Procedure, is a valid and enforceable judgment . . . .); 11A Michie's Jurisprudence Judgments and Decrees § 200 (1997) (A default judgment is final and enforceable unless set aside in accordance with the prescribed rules of procedure.). However, a final judgment on the merits is not, in and of itself, adequate to support the application of collateral estoppel.
In addition to the requirement of a final judgment on the merits, we have held that '[a] fundamental due process point relating to the utilization of collateral estoppel is that any person against whom collateral estoppel is asserted must have had a prior opportunity to have litigated his claim.' Syl. Pt. 8, Conley v. Spillers, 171 W. Va. 584, 301 S.E.2d 216 (1983). Syl. pt. 3, Christian (emphasis added). In the instant case, Colaianni did not have an opportunity to litigate the issue of Young's negligence prior to the entry of the default judgment.See footnote 11 11 Yet that question is crucial to finding Colaianni liable.
Under these circumstances, we find it is not proper to apply collateral estoppel
to preclude Colaianni from litigating the issue of Young's negligence. General
principles related to default judgments further support this conclusion.
A default judgment is a sanction that may be imposed against a party for his or her failure to comply with certain procedural requirements associated with a lawsuit. See 11A Michie's Jurisprudence Judgments and Decrees § 186, at 281 (explaining that a default judgment is based upon an omission to take a necessary step in [an] action within the proper time. (footnote omitted)). See, e.g., Napier v. Plymale, 167 W. Va. 372, 280 S.E.2d 122 (1981) (indicating that default judgment was appropriate sanction for unjustified delay in filing answer); Bennett v. General Acc. Fire & Life Assur. Corp., 149 W. Va. 92, 138 S.E.2d 719 (1964) (concluding that default judgment was proper against defendant who failed to appear either in person or by counsel on day of trial). It is punitive in nature and meant to deter such conduct. However, a person or entity hiring an independent contractor has absolutely no power to prevent the independent contractor's procedural default in any subsequent law suit that may arise from the contracted work. Consequently, penalizing such an individual for the defaulting conduct of the independent contractor would have absolutely no deterrent effect.
Moreover, it is well established that default judgments are not favored in the law. Indeed, as we stated in Intercity Realty Co. '[t]he law strongly favors an opportunity to a defendant to make defense to an action against him.' 154 W. Va. at 376, 175 S.E.2d at 456 (quoting Plumbly v. May, 140 W. Va. 889, 893, 87 S.E.2d 282, 285 (1955)). See also Daniels v. Hall's Motor Transit Co., 157 W. Va. 863, 865-66, 205 S.E.2d 412, 413 (1974) (This Court has held that it is the policy of the law to favor the trial of all cases on the merits, McDaniel v. Romano, 155 W. Va. 875, 190 S.E.2d 8 (1972).); 11A Michie's Jurisprudence Judgments and Decrees § 186, at 282 (Default judgments are not favored in law; courts exist to do justice and are reluctant to enforce an unjust judgment. (footnote omitted)). Applying collateral estoppel to prevent one party from mounting a defense when the estoppel is based solely upon another party's procedural default runs afoul of these principles. For these reasons, we hold that where a party is sued on a theory of vicarious liability arising from the negligence of an independent contractor, that party is entitled to defend on the basis that the independent contractor was not negligent, notwithstanding the entry of a default judgment against the independent contractor. However, the default judgment against the independent contractor remains in full force and effect regardless of the outcome of the litigation on the issue of his or her negligence.
We note that other courts addressing similar issues
have likewise concluded that a default judgment is not a proper foundation for
vicarious liability. See Dade County v. Lambert, 334 So. 2d 844, 847 (Fla. Dist. Ct. App. 1976) (finding
that county could not be held vicariously liable based on its employee bus driver's
failure to plead, and stating [t]he default of one defendant, although
an admission by him of the allegations of the complaint, does not operate as
an admission of such allegation as against a contesting co- defendant.
(citations omitted)); United Salt Corp. v. McKee, 96 N.M. 65, 68, 628
P.2d 310, 313 (1981) (refusing to set aside default judgment entered against
employees to the extent that it established the liability of the employees,See
footnote 12 12 but stating that the employer would nevertheless
be entitled to try the issues of negligence, respondeat superior
and the amount of damages. As long as these issues were raised by [the employer's]
pleadings, it should not be foreclosed from litigating them merely because [the
employees] defaulted. (emphasis added)).See
footnote 13 13
Based upon the foregoing analysis, we find that the
circuit court abused its discretion in granting a new trial founded upon its erroneous conclusion that
it had erred in submitting the question of Young's negligence to the jury. The
jury properly considered the question and found that Young did not act negligently.
As a consequence, Colaianni may not be held liable for Young's actions.
1Colaianni had been awarded the contract after the project had been put out for competitive bids. The project had been designed and the plans and specifications had been prepared by McKinley & Associates, Inc.
Footnote: 2 2This suit was designated Civil Action No. 97-C-324.
Footnote: 3 3Alvin and Adaline Stillwell are divorced.
Footnote: 4 4This suit was designated Civil Action No. 97-C-328.
Footnote: 5 5The consolidated suit was designated Consolidated Civil Action No. 97-C- 324.
Footnote: 6 6Young had been involuntarily dissolved by decree of court on April 15, 1994. In this appeal, the parties have raised issues involving the effectiveness of the dissolution and whether Young received proper service of process. Our resolution of this case, however, does not require us to decide these issues.
Footnote: 7 7On appeal, Colaianni has also raised an issue related to this finding. As we resolve this case on other grounds, we do not reach the issue.
Footnote: 8 8The Stillwell's filed a motion to dismiss this appeal claiming the lack of an appealable order. The motion was denied.
Footnote: 9 9In this case, there is no dispute among the parties that Young was an independent contractor of Colaianni.
Footnote: 10 10While, technically, there has been no filing of separate law suits in the case sub judice, for all practical purposes the claims against Colaianni and Young are the equivalent of two separate law suits. Consequently, it is appropriate to examine the issue herein raised in the context of collateral estoppel.
Footnote: 11 11Young, on the other hand, did have the opportunity to litigate the issue of its own negligence and failed to do so, resulting in the entry of the default judgment against it.
Footnote: 12 12The United Salt court did, however, set aside the default judgment to the extent it awarded damages. Because there was no independent cause of action against the employer, the court was concerned that inconsistent verdicts would result if the damage award was permitted to stand.
Footnote: 13 13But see Rogers v. J.B. Hunt Transp., Inc., 244 Mich. App. 600, 624 N.W.2d 532 (2001) (finding employer being sued on theory of vicarious liability could not contest employee's liability following default judgment against employee); Ha v. T.W. Smith Corp., 185 Misc. 2d 895, 896, 714 N.Y.S.2d 873, 874 (2000) (concluding that liability can be statutorily imposed upon the [employer/]owner of a vehicle where the [employer/]owner has appeared and contested liability and a default judgment has been granted against the [employee/]driver, but noting that the employer could have filed an answer on behalf of its employee).