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DEFENDANT PROPERTY OWNER FAILED TO DEMONSTRATE IT WAS THE ALTER EGO OF PLAINTIFF’S EMPLOYER OR THAT PLAINTIFF WAS DEFENDANT’S SPECIAL EMPLOYEE; THEREFORE PLAINTIFF’S PERSONAL INJURY ACTION WAS NOT PRECLUDED BY THE EXCLUSIVE REMEDY ASPECT OF THE WORKERS’ COMPENSATION LAW (SECOND DEPT).

The Second Department, reversing Supreme Court, determined defendant Zorn Realties, the owner of the property, did not demonstrate it was the alter ego of plaintiff’s employer, Zorn Poultry Farm, and did not demonstrate plaintiff was a special employee of Zorn Realties. Therefore, the negligence action stemming from plaintiff’s fall through a chute or a hole on defendant’s property was not precluded by the exclusive-remedy aspect of the Workers’ Compensation Law:

“‘A defendant moving for summary judgment based on the exclusivity defense of the Workers’ Compensation Law under this theory must show, prima facie, that it was the alter ego of the plaintiff’s employer'” … . “A defendant may establish itself as the alter ego of a plaintiff’s employer by demonstrating that one of the entities controls the other or that the two operate as a single integrated entity” … . However, “a mere showing that the entities are related is insufficient where a defendant cannot demonstrate that one of the entities controls the day-to-day operations of the other” … .

… Although the defendant presented evidence that the two entities were related inasmuch as they shared an address and a liability insurance policy, the defendant failed to establish that the entities shared officers or had identical owners. Additionally, the evidence showed that the entities served different purposes, had separate bank accounts, filed separate tax returns, and did not have a shared workers’ compensation policy … . …

“Many factors are weighed in deciding whether a special employment relationship exists, and generally no single one is decisive . . . Principal factors include who has the right to control the employee’s work, who is responsible for the payment of wages and the furnishing of equipment, who has the right to discharge the employee, and whether the work being performed was in furtherance of the special employer’s or the general employer’s business . . . The most significant factor is who controls and directs the manner, details, and ultimate result of the employee’s work'” … .

… [T]he defendant failed to establish … that the plaintiff was its special employee at the time of the accident because it did not submit sufficient evidence to establish, inter alia, that it controlled and directed the manner, details, and ultimate result of the plaintiff’s work, nor did it establish that the plaintiff had knowledge of and consented to a special employment relationship … . Mauro v Zorn Realties, Inc., 2022 NY Slip Op 03509, Second Dept 6-1-22

Practice Point: Here the defendant property owner was not able to take advantage of the exclusive-remedy aspect of the Workers’ Compensation Law in this personal injury action. Plaintiff’s employer was not the alter ego of defendant and plaintiff was not defendant’s special employee.

 

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