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Buckley v. American Fast Freight, Inc.

Supreme Court of Alaska

June 21, 2019

JOHN BUCKLEY, Appellant,

          Appeal from the Superior Court No. 3AN-13-10647 of the State of Alaska, Third Judicial District, Anchorage, Erin B. Marston, Judge.

          Michael Cohn, Weidner & Associates, APC, Anchorage, for Appellant.

          Susan Orlansky, Reeves Amodio LLC, and Eric Sanders, Law Office of Eric Sanders, Anchorage, for Appellees.

          Before: Bolger, Chief Justice, Winfree, Stowers, Maassen, and Carney, Justices.




         A worker for a temporary employment service was injured while working for a shipping company. At the time of injury he was performing a task prohibited by the contract between the temporary employment service and the shipping company. The injury resulted in loss of the worker's hand and part of his arm. After getting workers' compensation benefits from the temporary employment service, the worker brought a negligence action against the shipping company and one shipping company employee. The superior court decided on cross-motions for summary judgment that the exclusive liability provision of the Alaska Workers' Compensation Act (Act)[1] barred the action. We reverse the grant of summary judgment because material issues of fact preclude it.


         John Buckley started working for Labor Ready, Inc., a temporary employment service, in 2009. According to Buckley, workers would go to the Labor Ready office in the morning for assignments, and "there would be some days that [they] would be sent out and some days when there would be no work." Workers with assignments were given a "ticket" that they presented to the company using Labor Ready's services. Labor Ready employees could get "repeat" tickets when a contracting employer wanted Labor Ready to send those employees again, but Labor Ready did not always honor such requests. Labor Ready workers had to get approval from Labor Ready to work for a specific customer even if the customer and the worker both wanted the worker to continue to work for that customer.

         The "conditions of service" on the ticket prohibited Labor Ready employees from engaging in specified activities without Labor Ready's "prior written consent." For purposes of this case, the important restriction was that Labor Ready workers were not allowed "to operate dangerous machinery, mobile equipment or vehicles." Labor Ready paid the worker and provided workers' compensation coverage. The customer was required to determine whether Labor Ready's workers were qualified for the particular work assignment "during the first two hours of work" and "inform Labor Ready of any changes in work assignment." The contract provided that Labor Ready's employees were "under Customer's supervision, direction and control" and required the customer to provide safety equipment, information, and briefing to Labor Ready's employees. The contract did not specifically provide that a customer could fire a worker supplied by Labor Ready.

         Labor Ready's workers did not have to report for work every day; as Buckley put it, it was "up to you to go." He testified that Labor Ready employees could call beforehand to let Labor Ready know they would not be there, but if employees did not, Labor Ready "didn't really care" and would "put somebody else" on the job. Buckley, for example, did not work for several weeks in 2011 because he was helping care for his mother.

         During the time he worked for Labor Ready, Buckley reported to Labor Ready's office in the morning and picked up a ticket with his job assignment. Buckley prided himself on being a good worker and testified that Labor Ready at times sent him to work for new clients to impress the clients even if another client had requested Buckley for those days. In late 2011 Labor Ready at times assigned Buckley to work at American Fast Freight as a general laborer; he worked 17 non-consecutive days for American Fast Freight during the six weeks preceding the accident underlying this case.

         Buckley enjoyed his work with American Fast Freight; "the goal was that [Buckley] wanted to go to work as an employee of American Fast Freight . . . and American Fast Freight was hoping to hire [him]." But Buckley also testified that Labor Ready had sent him to work elsewhere, even when American Fast Freight had requested him. When he worked for American Fast Freight his job mainly involved loading and unloading freight. On any given day he might work in the warehouse or be assigned to a particular truck to accompany the driver for deliveries. During the time Buckley was assigned to American Fast Freight he got to know some of the drivers and had established relationships with some of them. Buckley indicated he could refuse to work with a truck driver there and that he had done so.

         On December 22, 2011, Labor Ready assigned Buckley to work at American Fast Freight. A driver, Denny Hawkins, told Buckley to come with him to deliver freight in the Wasilla area. Buckley grabbed "[his] stuff" - his "stuff" included a box knife, warm clothes, and an extra pair of gloves - and went out to Wasilla with Hawkins. After they completed their deliveries, Hawkins told Buckley he would treat him to lunch. Hawkins told American Fast Freight's dispatcher that he and Buckley were headed to lunch. According to Buckley, Hawkins got a call on his cell phone from another driver, Matthew Carroll, asking Hawkins for assistance, and Hawkins agreed to help him without informing the dispatcher.[2] Carroll's tractor-trailer was stuck in a snow berm near the Frontiersman newspaper office in Wasilla, and he was unable to move it.[3]Instead of going to lunch, Hawkins and Buckley headed to Carroll's truck.

         Hawkins unhitched his trailer and drove his truck so it was facing Carroll's truck; he then attached a tow chain to the trucks. In the meantime Buckley began to dig out the stuck wheel, first using his hands and then a shovel, but Carroll's truck remained stuck. The precise sequence of events that followed is difficult to discern because witnesses gave inconsistent accounts at different times, but someone decided to use tire chains to try to gain traction. American Fast Freight drivers sometimes laid tire chains out on the ground, rather than put them around the tire, to improve traction when a truck was stuck on snow or ice: Buckley said he had seen other American Fast Freight drivers do so and had assisted them in the past; Carroll said he too had previously used chains this way and had seen others do it; and Hawkins also indicated he had done this before. Two company officials reported during the subsequent accident investigation that drivers used chains this way at times, and company officials indicated that American Fast Freight was aware of the practice - one official said he had himself used chains this way as an American Fast Freight driver.

         Buckley laid a tire chain in front of the wheel and used hand and verbal signals to let the drivers know when he was clear of the truck. Carroll then tried to move the truck to engage the chain and get traction. The method was not successful, and in fact the wheel's spinning caused the tire chain to shoot out the back. The three men used the same approach four times with no success. Buckley then thought of laying a second chain behind the wheel, because he "noticed [Carroll] was rocking back a little bit." He asked Carroll where another chain was and got a second chain from one of the trucks so there would be a chain both in front of and behind the stuck wheel.

         The accident happened on the fifth attempt to move the truck. The drivers reported being focused on their trucks because they were concerned about a collision if Carroll got traction. According to Buckley, he was in the process of positioning the second tire chain behind the stuck wheel when Carroll gunned the truck engine; the wheel turned and caught the tire chain Buckley was adjusting, pulling his arm under the wheel. Buckley later said he had not given Carroll "any signal or indication . . . to move the vehicle." Hawkins noticed something amiss, got out of his truck, ran toward Buckley, and told Carroll to "put it in gear and spin it" because Buckley's hand was trapped. Hawkins went to the Frontiersman's office to get help. Buckley's arm was sliced just below the elbow and, in every practical sense, severed - the two parts of his arm remained barely attached. Buckley was also bleeding heavily. Frontiersman employees and the two drivers assisted Buckley. One Frontiersman employee used his belt as a tourniquet to staunch the bleeding until emergency medical personnel arrived; Buckley credited him with saving his life. Buckley had multiple surgeries, and according to American Fast Freight, his right arm was amputated above the elbow. He received workers' compensation benefits, presumably from Labor Ready given the terms of the contract between Labor Ready and American Fast Freight.

         The Alaska Department of Labor & Workforce Development, Division of Labor Standards & Safety, Occupational Safety & Health (AKOSH) conducted an investigation that ultimately led to a $5, 600 fine against American Fast Freight. American Fast Freight indicated that Buckley should not have been engaged in any activities related to freeing the truck and said "that for [the] future, [the] company has specifically prohibited temporary employees from being involved with tire chain up and stuck vehicles." According to AKOSH, the workers' actions during the incident reflected a number of violations of company policy.

         In November 2013 Buckley sued American Fast Freight, Carroll, and John Does 1-5 for negligence. American Fast Freight and Carroll answered, denying liability and raising the exclusive liability provision of the Act, AS 23.30.055, as a defense. No one joined Labor Ready.

         The parties filed cross-motions for summary judgment. American Fast Freight argued that it met all three tests for a special employer relationship set out in Anderson v. Tuboscope Vetco, Inc.[4] and that Buckley's suit was barred by AS 23.30.055 on that basis.[5] Buckley's cross-motion sought to bring his case under Estate of Milos v. Quality Asphalt Paving, Inc., [6] where we reversed a summary judgment on exclusive remedy grounds because a material issue of fact remained about the "work-relatedness" of the injury, i.e. whether it arose out of and in the course of employment.

         Pertinent to the question of a special employment relationship, Buckley argued that (1) no contract existed between himself and American Fast Freight; (2) Tuboscope was factually distinguishable from his case for various reasons, including that he reported to Labor Ready rather than American Fast Freight; and (3) the special employment doctrine did not apply to his case because Labor Ready continued to exercise control over its employees' duties through its customer contract. And with respect to his own cross-motion for summary judgment, Buckley contended that as a matter of law the injury did not arise out of and in the course of the employment because (1) he was on an unpaid lunch break when the accident happened; (2) using the tire chains as the workers did amounted to operating dangerous machinery, a violation of the contract between Labor Ready and American Fast Freight; (3) Hawkins's and Carroll's actions violated company policy; and (4) he had personal motives for participating in the activity. Buckley supported his assertion about operating dangerous machinery with a mechanical engineer's expert opinion.

         In opposition to Buckley's motion, American Fast Freight said that for purposes of summary judgment, it would assume several facts, including the following: Carroll and Hawkins violated employer rules; "letting Buckley handle tire chains . . . violated the contract between Labor Ready and [American Fast Freight]"; and Buckley and Hawkins were on an unpaid lunch break at the time they went to assist Carroll. It argued that even if those facts were true, Buckley's lawsuit was still barred by the exclusive remedy provision.

         The superior court granted summary judgment to American Fast Freight, deciding it was shielded by the exclusive liability provision of the Act. The superior court first considered the three-part test in Tuboscope, [7] deciding as a matter of law that (1) Buckley had an implied employment contract with American Fast Freight; (2) his work was done exclusively for the benefit of American Fast Freight; and (3) American Fast Freight had the right to supervise Buckley. From these findings the court concluded that American Fast Freight was Buckley's employer and was, in addition to Labor Ready, liable for workers' compensation benefits for the accident.

         The court then turned to whether Buckley's injuries arose out of and in the course of his employment with American Fast Freight and decided as a matter of law that they did. Applying factors discussed in Estate of Milos,[8] the court decided that Buckley being on an unpaid lunch break was immaterial because of the "strong nexus between Buckley's action and his employment with [American Fast Freight]." It also decided that Buckley's injury was "reasonably foreseeable from his employment" because "[a] truck getting stuck in the snow is not an uncommon occurrence in Alaska" and "it was common practice for nearby [American Fast Freight] employees to be called to assist other drivers."

         The court decided that the following facts were immaterial to the question of work-relatedness: (1) Buckley's activity was outside his job duties; (2) the activity was prohibited by the contract between American Fast Freight and Labor Ready; and (3) American Fast Freight admitted to AKOSH that Buckley was injured performing a task "outside the scope of his duties." The superior court granted summary judgment to American Fast Freight based on the exclusive remedy provision and denied summary judgment to Buckley,[9] dismissing the case and entering final judgment against Buckley. Buckley appeals.


         We review a grant of summary judgment de novo.[10] "Summary judgment is proper if there is no genuine factual dispute and the moving party is entitled to judgment as a matter of law."[11] "[A] party seeking summary judgment has the initial burden of proving, through admissible evidence, that there are no disputed issues of material fact and that the moving party is entitled to judgment as a matter of law."[12] If the moving party makes that showing, "the burden shifts to the non-moving party 'to set forth specific facts showing that he could produce evidence reasonably tending to dispute or contradict the movant's evidence and thus demonstrate that a material issue of fact exists.' "[13] "[A] material fact is one upon which resolution of an issue turns."[14] "The standard for finding a genuine issue of fact at summary judgment is lenient."[15] Whether a person is an employee for purposes of the Workers' Compensation Act is a mixed question of law and fact.[16]


         A. Material Factual Disputes Precluded Summary Judgment On The Special Employment Relationship.

         The superior court granted American Fast Freight's summary judgment motion, deciding as a matter of law that American Fast Freight was Buckley's special employer under the test we adopted in Anderson v. Tuboscope Vetco, Inc.[17] In that case we adopted a three-part test for special employment relationships from Larson's treatise on workers' compensation:

When a general employer lends an employee to a special employer, the special employer becomes liable for workmen's compensation only if:
(a) the employee has made a contract of hire, express or implied, with the special employer;
(b) the work being done is essentially that of the special employer; and
(c) the special employer has the right to control the details of the work.[18]

         When these conditions are satisfied in relation to both the general employer and the special employer, then both employers are liable for workers' compensation.[19]

         Although Tuboscope is our most recent decision about the special employment relationship, we acknowledged in Tuboscope that we had applied parts of the special employment doctrine in prior cases.[20] In Cluff v. NANA-Marriott, we stated that "the requirements for finding an employment relationship for workers' compensation purposes between a lent employee and a special employer are stricter than the standards for finding an employment relationship between an employee and an employer where there is only one employer."[21]

         Determining whether an implied employment contract was formed involves "considering all the factors in light of the surrounding circumstances."[22] "An implied employment contract is formed by a relation resulting from 'the manifestation of consent by one party to another that the other shall act on his behalf and subject to his control, and consent by the other so to act.' "[23] In the special employment context, we have also noted Larson's "great emphasis on the importance of a contract for hire with a special employer"[24] because in a special employment relationship, the employee "loses the right to sue the special employer at common law for negligence; and . . . the courts have usually been vigilant in insisting upon a showing of a deliberate and informed consent by the employee before employment relation will be held a bar to common-law suit."[25] The parties here disagree about the existence of an implied contract of hire between Buckley and American Fast Freight.[26] Buckley has consistently argued that his employment relationship with American Fast Freight is different from the employment relationship described in Tuboscope and that no special employment relationship existed between himself and American Fast Freight. In contrast American Fast Freight has argued that its relationship with Buckley falls squarely within the framework set out in Tuboscope.

         Tuboscope involved two companies, Tuboscope Vetco, Inc. and Olsten Staffing Services, that had "a continuing contract agreement for Olsten to provide temporary employees to Tuboscope," including a category of employees called PTP ("personnel transfer plan") employees.[27] "Tuboscope recruited, hired, placed, and directly and exclusively supervised PTP employees; Olsten provided the payroll administration, benefits, and workers' compensation coverage for PTP employees."[28]A PTP employee was injured while working for Tuboscope; he received workers' compensation benefits from Olsten and later sued Tuboscope.[29] After adopting the three-part test from Larson's treatise, we applied it to the facts of the case and held that Tuboscope met all of the tests.[30]

         We stated, "If the temporary employer hires, trains, employs, directs, and reserves the right to terminate the temporary employee, and the labor broker merely acts in the capacity of a payroll and benefits administrator, an employment contract exists between the temporary employer and the temporary employee."[31] We noted in our discussion that "[t]he contract between Olsten and Tuboscope regarding PTP employees effectively provided that Tuboscope would interview, hire, train, and employ the PTP employees."[32]

         The written contract between Labor Ready and American Fast Freight lacked several of these provisions, and the only additional pieces of evidence American Fast Freight submitted to the superior court were portions of Buckley's deposition testimony, a copy of the work ticket from the day Buckley was injured, a copy of the "Conditions of Service" in its contract with Labor Ready, and copies of some invoices from Labor Ready to American Fast Freight, showing that Buckley had worked at American Fast Freight on November 21.

         Unlike the worker in Tuboscope, Buckley did not "interview[] directly with" American Fast Freight, and no evidence shows that American Fast Freight recruited him.[33] The uncontested facts showed that while American Fast Freight may have requested Buckley as a worker, as the superior court noted, Labor Ready was evidently not obligated to comply with the request and provide Buckley as a worker to American Fast Freight. Buckley testified that Labor Ready had sent him to work for other clients of Labor Ready, even when American Fast Freight had requested him.[34] Buckley's testimony does not establish that American Fast Freight could hire him as that term is generally understood, [35] nor does any testimony or other evidence indicate that ...

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