Case Information
*1 IN THE
A RIZONA C OURT OF A PPEALS
D IVISION O NE
DAVID LEE PRUITT, Plaintiff/Appellant , v.
STATE OF ARIZONA, et al., Defendants/Appellees .
No. 1 CA-CV 24-0418 FILED 05-06-2025
Appeal from the Superior Court in Maricopa County No. CV2021-053278
The Honorable Michael D. Gordon, Judge
AFFIRMED
COUNSEL
Ahwatukee Legal Office, P.C., Phoenix
By David L. Abney
Co-Counsel for Plaintiff/Appellant
Shapiro Law Team, Scottsdale
By Rick Horton, David C. Shapiro
Co-Counsel for Plaintiff/Appellant
Arizona Attorney General’s Office, Phoenix and Tucson By Jennifer Rethemeier, Claudia Acosta Collings Counsel for Defendant/Appellee State of Arizona
OPINION
Judge Samuel A. Thumma delivered the opinion of the Court, in which Presiding Judge Kent E. Cattani and Judge Angela K. Paton joined.
T H U M M A , Judge:
¶1 Plaintiff David Lee Pruitt appeals from the grant of summary judgment for defendant State of Arizona (State) and the denial of his motion for new trial. Pruitt challenges the conclusion that the State is his statutory employer, arguing that the only contractual relationship is between the Arizona Department of Corrections, Rehabilitation and Reentry (ADCRR) and Pegasus Research Group d/b/a Televerde (Televerde). Because Pruitt has shown no error, the rulings are affirmed.
FACTS AND PROCEDURAL HISTORY Televerde contracts with ADCRR to employ inmates to work
at Televerde ’s call centers. Pruitt, a civilian, was employed by Televerde to supervise inmates working in the call center at the Perryville State Prison Complex. While escorting inmates from one building to another, Pruitt stepped in a pothole, fell and was injured. Pruitt filed for and received workers compensation benefits
from Televerde for his injuries. Pruitt then filed this tort case against the State and ADCRR, claiming negligence, premises liability and negligent hiring, entrustment and training. The State, after conducting discovery, moved for summary
judgment arguing Pruitt was a statutory employee under Arizona Revised Statutes (A.R.S.) section 23-902 (2025), [1] making the State immune from Pruitt’s tort claims. The State also argued that ADCRR is a non-jural entity, which cannot be sued. After full briefing, the superior court granted the State’s motion. After Pruitt unsuccessfully moved to reconsider, the court entered a final judgment resolving all of the parties’ claims.
¶5 Pruitt then filed a motion for new trial under Arizona Rule of Civil Procedure 59. He argued for the first time that, because “the State and [ADCRR] are distinct legal entities, ” the State could not be Pruitt’s statutory employer considering the only contract of employment regarding Pruitt was the contract between [ADCRR] and Televerde.” The State responded that (1) Pruitt waived this argument by failing to raise it before entry of final judgment and (2) because ADCRR is an arm of the State, the court properly granted the State summary judgment. In reply, Pruitt argued waiver did not apply because “ if there was no employment contract between the State and Televerde — and there was not ,” then the superior court lacked subject- matter jurisdiction to declare the State was a statutory employer. In denying the motion for new trial, the court affirmed the State “is the party who entered the contract at issue and therefore could [be] (and was) [Pruitt’s ] statutory employer .” Pruitt timely appealed from both the final judgment and the denial of his new trial motion. This court has appellate jurisdiction pursuant to Article 6, Section 9, of the Arizona Constitution and A.R.S. §§ 12-120.21(A)(1) and -2101(A)(1-2).
DISCUSSION
I. The Superior Court Did Not Err in Granting the State’s Motion for
Summary Judgment. Pruitt’s core argument asserts that the State is not, and could never have been, his statutory employer, meaning the entry of summary judgment was error. “The court shall grant summary judgment if the moving party shows that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Ariz. R. Civ. P. 56(a). Whether the State was Pruitt’s statutory employer at the time of his injury is a mixed question of law and fact subject to de novo review. See Mitchell v. Gamble , 207 Ariz. 364, 367 ¶ 7 (App. 2004) (citing cases). The court view s “ the evidence and reasonable inferences in the light most favorable to the party opposing the motion” for summary judgment. Andrews v. Blake , 205 Ariz. 236, 240 ¶ 12 (2003).
A. By Statute, ADCRR Is the State. Pruitt argues “the State and [ADCRR] are distinct legal entities” and “the contract under which Pruitt was employed was exclusively a contract between [ADCRR] and Televerde,” thus making it impossible for the State to be Pruitt’s statutory employer. Pruitt also argues he did not waive the issue by failing to raise it until the motion for new trial because, if there was no employment contract between the State and Televerde, then the superior court would have had no subject-matter jurisdiction to declare that the State was a ‘statutory employer’ of Televerde (and, hence, of Pruitt).”
¶9 Setting aside issues of waiver, Pruitt’s argument is unavailing. By statute, “‘ State ’ means this state and any state agency, board, commission, or department.” A.R.S. § 12 -820(8). ADCRR is a department of the State. Pruitt also concedes that ADCRR is a non-jural entity that cannot be sued. And by statute, “[a]ny and all causes of action that may arise out of tort caused by the director, prison officers or employees of [ADCRR], within the scope of their legal duty, shall run only against the state.” A.R.S. § 31-201.01(F). Given these statutory provisions, Pruitt points to the
language of the contract signed by ADCRR and Televerde, arguing it is exclusively between those two entities and does not include the State. Not so. The first page of the contract expressly uses “State of Arizona” in the heading, adding that “[r]eferences to State shall mean the State of Arizona.” The contract, in turn, specifies various rights and obligations of the State and Televerde, including cancellation provisions, audit of records, e- verification of employee records and indemnification and workers compensation. Pruitt admits the employer in this instance was ADCRR, which is an arm of the State. Because ADCRR is an arm of the State, the court did not err in concluding that, for purposes of Pruitt’s tort claims here, ADCRR is the State.
B. Pruitt Has Not Shown the Superior Court Erred in Concluding ADCRR I s Pruitt’s Statutory Employer. Pruitt argues the State was never his statutory employer and therefore had no right to use the statutory employer doctrine as an immunity defense. An entity seeking to show it is a statutory employer must show two things: (1) retention of supervision or control over the work procured to be done by a contractor and (2) the work entrusted to the subcontractor must be a “part or process in the trade or business” of the employer against whom the third-party tort action is asserted. Young v. Env ’t Air Prods., Inc. , 136 Ariz. 158, 161 (1983) (citing authority).
1. ADCRR Retained Supervision or Control Over the Work Procured by Televerde. To determine whether an employer is a statutory employer of
an independent contractor s employee, the court considers the control exercised by the employer over the contractor, not the employee. Young , 136 Ariz. at 163. Pruitt claims that “reasonable jurors could have concluded and inferred from the facts that [ADCRR] had no relevant supervision or control over the for-profit call center trade or business that Televerde was contracted to provide.” But an entity hiring a contractor exercises supervision or control over the contractor if the hiring entity retains “the right to control or supervise the methods of obtaining a specific result.” Hunt Bldg. Corp. v. Indus. Comm ’ n , 148 Ariz. 102, 105 (1986) (citation omitted). In making this determination, the court considers the totality
of the circumstances, including the following factors:
[T]he duration of the employment; the method of payment; who furnishes necessary equipment; the right to hire and fire; who bears responsibility for work[ers’] compensation insurance; the extent to which the employer may exercise control over the details of the work[] and whether the work was performed in the usual and regular course of the employer's business.
Home Ins. Co. v. Indus. Comm ’ n , 123 Ariz. 348, 350 (1979) (citations omitted). Wagner v. State applied these factors in a similar context, affirming summary judgment for the State. 242 Ariz. 95 (App. 2017). In Wagner , a clinical social worker, who worked for a contractor that provided healthcare services at state-owned prisons under a contract with ADCRR, slipped, fell and injured herself at a prison. Id . at 96 ¶ 2. The contract between the contractor and ADCRR required ADCRR to maintain facilities and fixtures for health services. Id. at 97 ¶ 10. Additionally, ADCRR retained the authority to approve the contractor’s hires, the contractor was required to have workers’ compensation insurance and ADCRR had the authority to monitor any correspondence, records, reports, or other written and/or electronic materials ” dealing with the contract. Id . at 97 – 98 ¶ 10. Looking to the substance of the contract and recognizing that the court should strictly construe the statute “when loss of the worker’ s common law rights is the object for which the statute is invoked,” Wagner affirmed the grant of summary judgment for the State. Id . at 96 ¶ 1, 96 ¶ 7 (citing Young , 136 Ariz. at 163). The court held the employee was a statutory employee of the State because the State retained the right to control or supervise the contractor ’ s work and because the services constituted a part or process in the usual and regular course of the State s business. Id . at 96 ¶ 1. Here, ADCRR and Televerde entered into a contract where Televerde agreed to pay ADCRR for the right to operate a call center in the prison. Televerde then provided work opportunities to ADCRR inmates to assist in their rehabilitation. ADCRR screened and approved the hires after performing a background check before allowing them access to the call center or to supervise inmates. T eleverde’s employees were subject to annual background checks to maintain access to the prison facilities. The contract with ADCRR required Televerde to provide workers ’ compensation insurance, and Televerde did so. Indeed, Pruitt received workers’ compensation benefits before filing this suit. ADCRR provided the land, the building and the infrastructure for the call center, while Televerde provided the necessary business equipment. Televerde provided supervisors “knowledgeable in the types of work tasks to be accomplished and the correct way to complete each task,” and who “supervise [d] inmate work production.” The contract limited the type of equipment that could be used in the call center, and ADCRR required Televerde’s staff to monitor and record all phone calls made by inmates to ensure the calls were pertinent to the inmates ’ work. The contract also required Televerde to comply with ADCRR’s “procedures in recording inmate work hours and rendering all payments.” These contract provisions show the same type of control over the work by ADCRR as in Wagner , if not more. Pruitt repeatedly states that “[t]here are genuine disputes on
the ‘statutory employee’ totality -of-the-circumstances supervision-and- control factors” that can only be resolved by a jury. But the State does not dispute the facts Pruitt asserted, and even accepting them as true, Pruitt is not entitled to relief. In arguing summary judgment was improper, Pruitt relies on
Livingston v. Citizen ’ s Utils., Inc. , 107 Ariz. 62 (1971), including a subsequent appeal in that case, Citizen s Utils., Inc. v. Livingston , 21 Ariz. App. 48 (1973). Livingston , however, is distinguishable. In Livingston , there was no written contract governing the relationship between the employer and the claimed statutory employer, with the court stating:
Where there is [] no express agreement as to the right of the employer to control the manner of doing the work by an alleged employee, the existence or non-existence of this right must be determined by reasonable inferences drawn from the surrounding circumstances and this is normally a question of fact for the jury.
107 Ariz. at 65. [2] But here, the relationship between ADCRR and Televerde is governed by an express written contract. The control exercised by the State over Televerde, which is the dispositive consideration, see Young , 136 Ariz. at 163, is defined in that written contract. The construction of a contract is a question of law when the terms are plain and unambiguous. ” Smith v. Melson, Inc., 135 Ariz. 119, 121 (1983) (citations omitted). Pruitt concedes the terms of the contract between ADCRR and Televerde are plain and unambiguous. Accordingly, the court did not err in concluding that there is no genuine issue as to any material fact and that the State is entitled to judgment as a matter of law. See Avila v. Northrup King Co. , 179 Ariz. 497, 505 (App. 1994) (citing cases). Pruitt argues “[s]tatutory immunity cannot apply in favor of
the State where it is not subject to any liability for paying any workers’ compensation benefits ” because Televerde was the party that provided the workers’ compensation insurance . But that expense was presumably accounted for as part of the negotiated contract between Televerde and ADCRR. And in any event, Pruitt’s argument is contrary to Wagner , where the court concluded the State was a statutory employer and immune from suit even where the third party contractor provided the workers ’ compensation insurance. 242 Ariz. at 98 ¶¶ 11 – 13. On this record, and given the similarities with Wagner, the superior court did not err in concluding the State retained supervision or control over the work procured to be done by Televerde.
2. The Work Entrusted to Televerde W as a “ Part or Process in the Trade or B usiness” of ADCRR. Pruitt argues reasonable jurors could have concluded “Televerde’s call -center trade or business was not — in any realistic or meaningful way —‘ part or process in [ADCRR] ’s unique and distinctly different prison-correctional trade or business. ” He argues “no reasonable juror would ever infer that the ‘particular work activity’ of operating a call center is in any way regular, ordinary, or routine in [ADCRR’s] operations or is something that [ADCRR] employees would do ‘regularly.’” Pruitt also attempts to distinguish Wagner by arguing that, “unlike the provision of healthcare services to inmates in Wagner , it is not a part or process of [ADCRR’s] business to operate a for -profit call- center operation.” Pruitt’s argument is unavailing. Like in Wagner , ADCRR has a statutory duty to “[m]aintain and administer all institutions and programs within the department, including prisons . . . and such other facilities and programs as may be required and established for the custody, control, correction, treatment and rehabilitation of all adult offenders who are committed to the department.” A.R.S. § 41 -1604(A)(2). By statute, the ADCRR director may lease prison property in connection with the Correctional Industries Program “to a private corporation for the purpose of establishing and operating . . . [a] commercial enterprise deemed by the director to provide employment opportunities for inmates in meaningful jobs for wages. ” A.R.S. § 41-1623(D). Thus, the work entrusted to Televerde was a “part or process in the trade or business” undertaken by ADCRR to provide rehabilitation services.
3. Pre- Wagner Case Law, as Well as Cases Applying Wagner , Support the Grant of Summary Judgment Here. Despite Pruitt ’s effort to portray Wagner as an outlier, cases
before Wagner and applying Wagner support the grant of summary judgment. Karandbir Sandhu v. State , decided two weeks before Wagner, involved an employee of the same contractor as in Wagner that provided healthcare services to ADCRR. See No. 1 CA-CV 16-0095, 2017 WL 1278982, at *1 ¶ 2 (Ariz. App. Apr. 6, 2017) (mem. decision). The employee filed a negligence claim against the State after an inmate assaulted him. Id . at *1 ¶¶ 2 – 3. The court affirmed the grant of summary judgment for the State, concluding that “through the parties’ detailed contract, ” ADC RR “ retained control over [the contractor’s] provision of health and dental services inside [ADCRR] facilities. ” Id . at *2 ¶ 9. Karandbir Sandhu supports the superior court’s grant of summary judgment here. More recently, Fox v. Arizona involved an employee of a
contractor providing healthcare services to ADCRR who filed tort claims against the State after being sexually assaulted at a prison. CV-21-01089- PHX-MTL, 2023 WL 4315221, at *1 (D. Ariz. July 3, 2023). The State moved to dismiss the case under the workers’ compensation statute . Id . Applying Wagner , the United States District Court concluded the contract between [the contractor] and [ADCRR] controls their relationship ” and weighed the Home Insurance factors to conclude the employee was a statutory employee of ADCRR. Id . at *4, *8. Fox , again in the prison context, applied Wagner in a way supporting the superior court’s grant of summary judgment here. ¶23 Because both Young inquiries are satisfied, the superior court did not err in concluding that Pruitt was a statutory employee of the State at the time of his injury. Accordingly, the court properly entered summary judgment for the State.
II. The Superior Court Properly Denied Pruitt’s Motion for New
Trial. Pruitt argues the superior court erred in denying his Rule 59 motion for new trial. A superior court has considerable discretion in deciding a motion for new trial. See, e.g. , City of Glendale v. Bradshaw , 114 Ariz. 236, 238 (1977). This court will not reverse a ruling on a motion for new trial “absent a clear abuse of discretion.” Delbridge v. Salt River Project Agric. Improvement & Power Dist. , 182 Ariz. 46, 53 (App. 1994) (citing cases). Pruitt claims the superior court erred in denying his motion for new trial because the judgment and orders related to it were based on the conclusion that the State was Pruitt’s statutory employer, which he argues was an abuse of discretion depriving Pruitt of a fair trial, Ariz. R. Civ. P. 59(a)(1)(A), resulted from errors of law, Ariz. R. Civ. P. 59(a)(1)(F), lacked evidentiary support, Ariz. R. Civ. P. 59(a)(1)(H) and was contrary to law, Ariz. R. Civ. P. 59(a)(1)(H). As noted above, however, the superior court properly concluded the State was Pruitt’s statutory employer. Similarly, the superior court’s finding did not result from an error of law, was not contrary to the law and did not lack evidentiary support. For these reasons, Pruitt has shown no error in the superior court denying his motion for new trial.
ATTOR NEYS’ FEES ON APPEAL Pruitt requests attorneys’ fees and costs incurred on appeal
pursuant to ARCAP 21(a) and A.R.S. §§ 12- 341 and 342. Because Pruitt is not the successful party, his request is denied.
CONCLUSION The grant of summary judgment and the denial of Pruitt’s
motion for new trial are affirmed.
[1] Absent material revisions after the relevant dates, statutes and rules cited refer to the current version unless otherwise indicated.
[2] Given this distinction, Pruitt’s reliance on “the decision - making process” in the Livingston trial after remand is not relevant here. Moreover, in the second Livingston appeal, the court vacated a $113,000 verdict for plaintiff, finding her claim failed on grounds not at issue here. See 21 Ariz. App. at 53 – 54.