Cordero v. Gulfstream Development Corp.
2012 Del. LEXIS 599
| Del. | 2012Background
- Cordero was injured on July 31, 2008 while working for Rodriguez, a sub-subcontractor to Gulfstream and with Delaware Siding as a separate subcontractor; none of the prime entities employed Cordero.
- Rodriguez held a workers’ compensation policy certified to Delaware Siding in February 2008, but that policy was canceled in March 2008 and replaced by a new policy in May 2008 that was later canceled in July 2008, during which time Cordero was injured.
- Delaware Siding furnished Gulfstream with a certification of insurance dated September 19, 2007 for coverage September 2007–September 2008; there is no claim that Delaware Siding’s coverage lapsed during that period.
- Cordero sought workers’ compensation coverage under § 2311(a)(5) against Gulfstream and Delaware Siding; the Board and Superior Court dismissed, holding § 2311(a)(5) provides a safe harbor but does not impose ongoing verification duties.
- The Superior Court concluded that once a valid certification is obtained, there is no affirmative obligation to follow up on ongoing coverage, though a good faith monitoring duty may arise if the contractor knows a subcontractor’s coverage has lapsed or may lapse.
- The Delaware Supreme Court affirmed, interpreting § 2311(a)(5) as a safe harbor from § 2311(a)(4) liability and clarifying that an implied monitoring duty exists only in the narrow circumstance of known past lapses by the subcontractor.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does §2311(a)(5) bar Cordero’s claims if a contract date exists? | Cordero asserts no valid contract date was established. | Gulfstream/Delaware Siding argue §2311(a)(5) is satisfied by a valid certification and retention for 3 years. | Waived; even if reached, meritless. |
| Does §2311(a)(5) impose unconditional ongoing liability on contractors? | Cordero contends contractors must insure subcontractor employees at all times. | Statute creates a safe harbor, not unconditional coverage. | No unconditional obligation; safe harbor applies when certification is in force. |
| Does §2311(a)(5) impose an implied monitoring duty throughout the coverage period? | Contractors must monitor continuously that certifications remain in force. | Monitoring duties arise only in narrow known-lapse scenarios; not generally. | Implied monitoring duty only in the narrow known-lapse circumstance; otherwise none. |
Key Cases Cited
- Pub. Water Supply Co. v. DiPasquale, 735 A.2d 378 (Del.1999) (statutory interpretation principles; give effect to whole statute)
- Olney v. Cooch, 425 A.2d 610 (Del.1981) (interpretation of Delaware statutes; give effect to language)
- UIAB v. Duncan, 337 A.2d 308 (Del.1975) (agency review framework; substantial evidence standard)
- Doroshow, Pasquale v. Nanticoke Mem. Hosp., Inc., 36 A.3d 336 (Del.2012) (statutory interpretation; monitoring and due diligence context)
- Keeler v. Harford Mut. Ins. Co., 672 A.2d 1012 (Del.1996) (principles of statutory interpretation; effect of whole statute)
- Person-Gaines v. Pepco Hldgs., Inc., 981 A.2d 1159 (Del.2009) (statutory interpretation; reliance on plain meaning)
- French v. State, 38 A.3d 289 (Del.2012) (Delaware Supreme Court guidance on statutory construction)
- Grabowski v. Mangler, 938 A.2d 637 (Del.2007) (Delaware appellate standard for reviewing agency decisions)