Isabel YANEZ, Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee

improper motion. allegedly ty explain their the sanction.

Accordingly, we vacate of the district court

The attorneys’ The award of

REVERSED. and VACATED.

fees is REVERSED is VACATED.

sanctions order YANEZ, Plaintiff-Appellant,

Isabel America,

UNITED STATES

Defendant-Appellee

No. 93-16943. Appeals, Court of

Ninth Circuit.

Argued March 1995. and Submitted Aug.

Decided

As on Denial of Amended Rehearin g Oct. 1995.* *Judges grant it. Fletcher and Reinhardt have voted to has voted to deny petition rehearing. Judge Noonan FLETCHER, REINHARDT,

Before: and NOONAN, T. Judges. John Jr. Circuit FLETCHER; Opinion by Judge Partial Concurrence and Judge Partial Dissent NOONAN.

FLETCHER, Judge: Circuit appeals Plaintiff Isabel Yanez the district partial judgment court’s pleadings on the and partial summary judgment in favor of the States her action under the Feder- (“FTCA”), al Tort Claims Act 28 U.S.C. §§ damages 2674. Yanez seeks for injuries performing she sustained while work independent contractor, for an Caelus De- vices, (“CDI”), Inc. factory. at its munitions She claims that the United States is liable under the risk doctrine and because negligent it exercised control over CDI’s ac- part tivities. We affirm in reverse part. &

FACTS PRIOR PROCEEDINGS This case arises out of Isabel Yanez’s em- CDI, ployment with a munitions contractor for the United States. On June Yanez lost arm her left and suffered third degree burns when dextrinated lead azide Broco, Inc., exploded supplied at CDI. lead azide to CDI. claiming Broco in state court sued

that its defective lead azide was the cause of injuries. her CDI then sued Broco. cases were consolidated. The Yanez-Broco $375,000, suit settled for and the CDI-Broco $90,000. ap- suit settled for Yanez received $200,000 proximately compensa- in workers’ injuries. tion benefits for her exhausting After her administrative reme- dies, against Yanez filed suit in federal court FTCA, alleging the United States under the government’s negligent inspections safety regulations lax enforcement of Francisco, CA, Joseph Appel, J. San for injuries. caused her The United filed States plaintiff-appellant. third-party complaint Broco for Murphy, Atty., indemnity F. William Asst. U.S. San or contribution. Broco moved for Jose, CA, complaint defendant-appellee. third-party dismissal of the based A. Review with Yanez. The Standard good faith settlement on its this motion. The Unit- court denied district judg The district court entered plead- moved for ed States pleadings ment on the motion, court denied ings. The district judgment pleadings claim. A on the is re applied peculiar risk doctrine ruling that the viewed de novo. Westlands Water Dist. v. The United States then to Yanez’s claim. (9th Canal, 667, Firebaugh 670 Cir. on the doctrine of based moved to dismiss 1993). may grant The district court a motion Yanez

judicial estoppel, arguing that because judgment pleadings on the “when the that Broeo had represented in state court clearly moving party establishes on the face estopped injuries, was from caused her she pleadings that no material issue of fact claiming in court the United federal that it remains to be resolved and is entitled injuries. The district States had caused her judgment as a matter of law.” Hal Roach This court re- granted court the motion. Studios, Co., Inc., Inc. v. Richard Feiner & remanded, finding that Broco and versed (9th Cir.1989). 1542, 1550 could be concurrent causes the United States States, injuries. Yanez v. United of Yanez’s B. Federal Tort Claims Act (9th Cir.1993). 323, F.2d 326-27 989 sovereign immunity The FTCA waives the remand, the renewed its On United States of the United States for claims based on the judgment pleadings on motion for based negligent wrongful or acts of United States Supreme Court’s recent on the California employees. § 28 U.S.C. 1346. The FTCA Court, Superior in v. 5 decision Privette provides cannot be held 72, 689, Cal.Rptr.2d 21 P.2d 721 Cal.4th 854 vicariously negligence an liable for the (Cal.1993), its lack of control over CDI. of an contractor. 28 motion, granted court con- The district 2671; States, § Logue v. U.S.C. struing the control claim as a motion for 2215, U.S. 93 S.Ct. 37 L.Ed.2d 121 summary judgment peculiar partial and the FTCA, government’s Under the judgment a motion for on the risk claim as liability is determined “in the manner same remand, pleadings. On Broco moved for re- private extent and to the same as individual of its motion to dismiss based consideration 2674; § in like circumstances.” 28 U.S.C. in good faith settlement state court. Kangley v. United 788 F.2d 533 found that this motion was The district court Cir.1986). plaintiffs Because accident oc- it held that the moot because United States California, governed curred this action is liable, making government’s was not 1346(b). by § California law. 28 U.S.C. indemnity against Broeo unneces- claim for timely sary. appealed. Yanez C. Law California California, rule, general In sub JURISDICTION ject exceptions, princi that a to numerous is jurisdiction pursuant had The district court pal is not for torts committed liable jurisdic- § to 28 1346. This court has U.S.C. independent contractor. See Van Arsdale v. court’s final tion over the district Hollinger, Cal.Rptr. 68 Cal.2d § under 28 1291. U.S.C. (Cal.1968). P.2d doctrine, which is described the Restate DISCUSSION (Second) of Torts sections 416 and ment applies exception is an to this rule that when Liability I. Peculiar Risk injury. poses the work an inherent risk of argues that Yanez in Privette directly liable under the risk doc- Before the recent decision Court, 689, 21 special precau- Superior v. 5 Cal.4th Cal. trine for its failure to take (1993), Rptr.2d P.2d 721 the contractor has failed to do tions where vicariously1 disagree. courts held that a was so. We FTCA, may vicariously § held liable. 28 U.S.C. 2671. How- 1. Under the the United States argument unavailing to take because after for the failure of its contractor Privette liable against peculiar risks— special precautions principal may delegate supervise its required precautions had been even such safety precautions of its contractor. See, e.g., Aerojet Woolen v. contract. Corp., Cal.Rptr. Gen. Second, argues that the United State, (1962); v. 369 P.2d 708 Holman may liable States be held under section 413 781-84 (Second) of the Restatement of Torts for its (Second) § Restatement of Torts appropriate precautions failure to take where Supreme the California Court CDI failed to do so. Owens Giannetta by holding: itself reversed Cal.App.4th Heinrich Constr. When, here, injuries resulting from as 11, denied, Cal.Rptr.2d 14 rev. 1994 Cal. performance contractor’s (Cal.1994), provides sup LEXIS 3286 some inherently dangerous to an of work are Owens, port for her claim. a California contractor, employee of the and thus sub- Appeals suggested Court of that even after ject compensation coverage, to workers’ Privette direct still exists under sec peculiar of risk affords no the doctrine requires principal pro tion which a to recovery for the to seek of basis protections against peculiar vide contractual damages tort from the who hired Id.; risks. see also v. United Littlefield inju- the contractor but did not cause the States, (9th Cir.) (duty 927 F.2d 1103 ries. requiring under section 413 is limited to a at Cal.Rptr.2d 21 at 730. After appropriate safety contractor to take mea Privette, permits principal a to denied, contract), in its sures cert. 502 U.S. duty reasonably delegate provide its to a safe (1991); 112 242 S.Ct. 116 L.Ed.2d place employees, work to its contractor’s States, Nelson v. United 477 involved, “peculiar risks” are even where (9th Cir.1980) (“The duty essence of the ... rely compensation to on the state workers’ imposed by Section 413 con [is] system to make the worker whole. Id. tractually for the contractor’s observance of argues apply Yanez that Privette does not specific safety precautions.”). detailed and to her case because she seeks to hold the However, Yanez’s claim misses the mark be directly, vicariously, United States liable allege she that cause fails the defendant’s negligence. for its We conclude that adequately protect contract did not her properly rejected claim. district court this risks inherent in muni argues, citing pre-Privette Yanez first sec production.2 relying tions Instead of on this cases, tion 416 can held that Privette, exception argues narrow Yanez (as opposed liable for its failure to the con that under section 413 the United States is failure) supervise tractor’s under section negligent supervise liable for its failure Brewing Regal 416. See Aceves v. Pale precautions taken its contractor and 595 P.2d 619 precautions necessary. to take those itself (1979); Sanitation, Inc., Rossmoor Widman exactly liability rejected by This is the sort of (1971); v. Gardner United Privette. Because we conclude that Yanez’s (9th States, Cir.1986); McGarry F.2d indistinguishable “section 413” claim is from (9th States, Cir.1976), 549 F.2d 587 United theory liability rejected in of we denied, cert. U.S. S.Ct. States, judgment affirm the court’s on the district L.Ed.2d 279 Thorne v. United (9th Cir.1973). However, pleadings claim. 479 F.2d 804 on Yanez’s ever, Indeed, claim, had section 416 has been construed as if Yanez stated such at district court would have arrived the same creating government's direct non- It would have construed her motion as result. delegable duty to ensure that the contractor em- partial summary judgment, examined the one for ploys proper safety procedures. See McCall v. contract, terms of the and determined Cir.1990) properly delegated had its Government CDI. See Hal Roach cases). (collecting Studios, 1550; 896 F.2d at 12(c). Fed.R.Civ.P. [Pjlaintiff presented that Liability Arising Retention has evidence

II. of from inspectors negligent were Control ensuring operations that the CDI met the evi- argues next that because the contractually safety required standards finding that the United supports a dence failing up findings improper to follow on activities, over CDI’s exercised control States floors, symbols, im- fire non-conductive by granting summary court erred the district machinery proper placement explo- with negligent her judgment to the defendant on sives, improper storage of hazardous district control claim. We reverse presented also ev- materials. has Plaintiff finding that was court’s government inspectors knew idence theory. under a “control” not hable widespread required non-use act on this conductive shoes but failed A. Standard Review information. Denying Motion Order court treated the defen The district Defendant’s Judgment Pleadings, on the Dee. pleadings motion for dant’s added). (emphasis control claim as a motion for on the retained summary judgment. grant government’s A district court’s evidence of the knowl- edge safety summary judgment is novo. of the violations at CDI raise the of reviewed de R.R., question knowledge of whether such v. Union Pac. 968 F.2d 940 Jones Cir.1992). government’s part (9th was sufficient to create a to Rule Pursuant Federal of or, itself, duty to Yanez to order correction 56(c), summary grant the Civil Procedure take corrective action. if, judgment is reviewed to determine view light ing the facts the most favorable to (Second) 414 of the Section Restatement nonmoving party, the there are no issues of adopted by Torts has been California courts. correctly material fact and the district court See, e.g., Austin v. Riverside Portland Ce- Tzung applied the relevant substantive law. Co., ment 44 Cal.2d 282 P.2d 73 Co., Casualty Fire & F.2d v. State Farm State, Cal.App.3d Holman v. (9th Cir.1989). (1975). 1339-40 Cal.Rptr. pro- 781-84 It vides: Independent who work to an B. Contractors One entrusts Control Over contractor, but who retains control of the law, argues that under California work, subject liability any part of the disputes sufficient of material she has raised physical harm to others for whose concerning government’s fact the control safety employer duty the owes a to exer- summary judgment. over to survive CDI care, cise reasonable which is caused agree. We his failure to his control with rea- exercise partial summary judgment In its first on employer may, sonable care.... The how- government ever, Yanez’s claim that the had retain a control less than that which non-delegable duty breached its a necessary subject him as workplace, safe a claim that has since been may only power master. He retain undermined the district court direct the order which the work shall be following being found that evidence created or to in a man- done forbid its done disputes likely dangerous of material fact as to whether the ner to be to himself or government duty supervisorial may a control had breached its of care: others. Such Rather, question government's government 3. The contends that section 414 is is whether employees alleged irrelevant to Yanez's claim because federal law are themselves liable torts controls the initial determination of whether a plaintiff. to have been committed In entity employee. agree or is a federal We regard, a as that federal law controls the determination of the employer ... contractor or an is “liable in the employee. an individual as a federal status of private the same a same manner and to extent as 1346(b); § See 28 U.S.C. States, Brandes v. United individual under like circumstances.” See 28 (9th Cir.1986). purpose, apply § U.S.C. 2674. For this we state not, however, alleged dispute here is whether the 1346(b). § law. 28 U.S.C. employees government. are tortfeasors subject prin- him right under the exercise their to order the contractor to may them, and, not, ciples Agency, he correct if but liable it did to order the California, in this facts, under the rule stated Section unless work halted. these true, supervisory control he exercises his with are sufficient to establish under prevent Holman, so as to the work reasonable care section 414. See which he has ordered to be done from Consequently, 781-84. Yanez is entitled injury causing to others. present jury. her evidence to the On this basis, we reverse the district partial court’s (Second) § of Torts Restatement summary judgment for the defendant on the a. comment plaintiffs control claim. Accord McMichael agree government that We with the v. United right under California law “the mere to see Cir.1988). satisfactorily completed that work is [does CONCLUSION impose[] upon hiring the one an inde

not] pendent contractor the to assure that partial We affirm the district judg- court’s performed contractor’s work is in con pleadings dismissing ment on the plain- formity safety provisions.” with all Kuntz tiffs risk claim but par- reverse the Del E. Webb Constr. summary judgment tial for the defendant on In plaintiffs control claim. We remand for deed, California courts have found proceedings further in accordance our with principal may general power retain broad decision. inspect, control to to make recommenda PART; AFFIRMED IN IN REVERSED tions, prescribe and to alterations and modifi PART; REMANDED. altering relationship cations without See, principal e.g., and contractor. Mc NOONAN, Judge, concurring Circuit Oil, Co.,

Donald Shell Cal.2d 285 dissenting: (Cal.1955); P.2d Letnes v. United I in opinion holding concur the of court the States, Cir.1987); Court, Superior that Privette v. 5 Cal.4th Kirk v. United 116-17 689, (1993), Cal.Rptr.2d 854 P.2d 721 (9th Cir.1969) (retention right inspect of decided while this case was still the before stop work does not create court, plaintiffs district doomed the I cause. However, employees). contractor’s here the however, disagree, portion that some of that plaintiffs may prove something evidence cause still has a half-life after Privette. government’s knowledge more —the of a dan conclusion, reaching my I believe that I do gerous appropri condition and failure take applying what a federal court do in should ate action to correct it. It is here that the is, relevant state law: that follow the reason- government’s argument fails. ing highest court state’s even as to theory particular expressly not State, In Holman v. a California by certainly dealt with that court and as to a Appeal Court of held that section 414 rejected theory liability expressly by the applies where a has actual knowl highest erroneously state’s court and revived edge dangerous of a condition and the au by the aberrant decision of a lower state thority dangerous to correct the condition.4 court. Kuntz, 781-84; at see also JplJpLiability Section 530-31, (apply at 368 P.2d at 130 contractor). Here, risk, ing general same rule to Privette dealt with not liabili- ty reasoning evidence adduced Yanez indicates that for retained control. Its is not Privette, government inspectors may have had actual limited to risk. After an knowledge safety independent violations and the dan contractor’s cannot violations, posed by yet gers compensation failed to obtain workers’ and then ob- Hol- distinguish reasoning 4. The does not on such a attempts opinion’s depend man, arguing that it to landowners. applies only distinction. We find this contention because the unpersuasive windfall,” “an unwarranted while the exclu- recovery person from the who tain a second sivity compensation would work employer to have that of workers’ his with contracted job: injustice against party “when the con- to the contract perform the employer working obtaining indemnity safe con- by preventing failure to him from tractor’s injury contractor’s to the independent responsible results contractor ditions from the per- recovery from the employee, injury. additional nonnegli- who hired the contractor —a son applies equally to “re- This set of reasons no societal interest that gent party —advance liability, unless the control is tained control” already by the workers’ com- served is not person contracting for the work such that the Cal.Rptr.2d system.” pensation actually acting employer, as the which is This conclusion is 854 P.2d compensation insurer case his workers’ con- far California law is peremptory. As as injuries and he would benefit would cover the cerned, societal it authoritative as is exclusivity compensa- of workers’ from states in tort. Privette interests to be served party tion. If the control of the to the compensation explicitly that workers’ ensures not sufficient to make him an contract is injuries compensated” ... will “that be both employer, Privette the exclusive then under adequate safeguards are taken to and “that remedy employee’s injury through for an injuries.” prevent Id. such employer, in the insurer of his this case the objected language might that It independent contractor. insurer of person Supreme applies only to a law, Applying California we are bound “nonneg- characterizes as Court of California produce a result that the California Su- liability applies to a ligent,” while section 414 anomalous, preme stigmatized Court has as negligent person who has hired a contractor. Supreme that Court has de- goes further. Because of the But Privette unjustified gives an benefit to the clared exclusivity compensation, allow- workers’ plaintiff employee, that the California Su- per- ing employee to recover unjust preme Court has found to be to the produces son who has hired the contractor party to the contract with the result” that the “anomalous however, here, does contractor. The court greater than that of the em- things continuing all these to treat negligence ployer whose also caused the em- possessing California section cases as injury. at 727- ployee’s Id. vitality. my That mind is not a fair and reasoning of approved Privette of the 28. application faithful of the current law of the exclusivity of workers’ other courts applying. are state whose rules we compensation protect party the to the should if Pri- Even section survived indirectly pays contract who for the cost of vette, misapplying the court would be estab coverage through price. contract Id. the the According to section lished California law: 854 P.2d at 727-28. The court found b, usually though the rule “is Comment persuasive reasoning spe- contained in a exclusively, applicable principal when a chapter draft cial note to the tentative part contractor entrusts a of the work of the Restatement. Id. at 854 P.2d at subcontractors, through but himself or a applied explicitly That note to sec- 728-29. job.” superintends foreman entire as to 413 and tion as well section Clearly application possible is not this usual liability: in section 416 “when the Sections question is if in an here. The then Chapter speak of to ‘another’ or application is warranted here. Ac unusual ‘others’, persons’, it or to ‘third be cases, it not: “an cording to California employees con- understood that independent con owner’s demand that tractor, as well of those of the defendant safety regulations comply with does Torts, tractor himself, not included.” Rest.2d are guarantor that not make the owner a 16, 1962, Apr. spe- Tent.Draft No. ch. are, fact, regulations respected.” in Smith v. note, Privette noted pp. cial 17-18. further ACandS, Inc., Cal.App.4th 37 Cal. recovery allowing after work- second v. Rptr.2d 457 also McDonald paid see compensation ers’ benefits were would Co., 902, 904 give employees independent contractors Shell Oil (1955) (“owner may general habihty. retain broad and section 413 21 Cal. power supervision and control ... without Rptr.2d at n.80 854 P.2d at 730 n. 4. How relationship changing the from that of owner Owens could conclude that section 413 habih contractor”). independent ty survives beyond imagination. Privette is obhgation accept We have no this maver Language legal here reflects law. No misreading ick Supreme Court of Cali party term has been coined to describe the fornia. contract who the of the other party to the contract seeks to hold in hable course, employer.

addition to his own Of if party

“the to the contract” was a party agent,

and the other his could he party

hable. Or to the contract was a might way

landowner he be hable some property.

the conditions on the But merely party agree- who is to an requiring independent ment contractor to CORP., In re PARK-HELENA Debtor. perform work on that contrac- premises special tor’s no has name. And he STARRETT, INC., NEBEN & sense, special has no name because common Plaintiff-Appellant, law, put like California does not him in a category Habihty. of common Liability Section íl3 CHARTWELL FINANCIAL CORPORATION, Defendant-Appellee. Owens was incorrect in its dicta that the holding apply Privette court “intended its No. 94-55686. only third-party in those situations where habihty is vicarious rather than direct.” Ow Appeals, States Court of ens v. Giannetta-Heinrich Const. Ninth Circuit. Cal.App.4th Cal.Rptr.2d Argued and Submitted June 1995. only language Not does the in Pri- suggest contrary, vette but Privette ex Aug. Decided plicitly overrules several so-called “direct” habihty cases. The court in our case is

incorrect its dicta to treat Oioens as reviv

ing habihty. section 413

The Privette court cites five cases for Cali- expansion habihty

fornia's employees,

cover progeny, Woolen and its Arsdale, Van and Aceves. Of

Ferrel Griesel five, these four were so-called “direct” sec-

tion 413 cases in which the contracts failed to precautions. Aerojet, Woolen v. 407, 410, Cal.Rptr. 369 P.2d (1962); Safway Scaffolds, Ferrel v. Steel 651, 656, Cal.Rptr. Cal.2d 371 P.2d Indus., (1962); Inc., Griesel v. Dart 578, 582,

Cal.3d Regal Brewing Aceves v. Pale Cal.3d

P.2d 619 To the extent that these pecuhar habihty

cases extended to em-

ployees, exphcitly Privette overruled them distinguishing

without between section 416

Case Details

Case Name: Isabel YANEZ, Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee

Court Name: Court of Appeals for the Ninth Circuit

Date Published: Oct 23, 1995

Citation: 63 F.3d 870

Docket Number: 93-16943

Court Abbreviation: 9th Cir.