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Date: 04-03-2020
Case Style:
STEPHANIE BONEBRIGHT v. CITY OF MILLER and SDML WORKERS’ COMPENSATION FUND
Case Number: 2020 S.D. 16
Judge: Mark E. Salter
Court: IN THE SUPREME COURT OF THE STATE OF SOUTH DAKOTA
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James Bonebright began his employment with the City of Miller (the
City) in 1987, working for the water department. In 2003, he was promoted to
superintendent of the water department. His predecessor, Bill Lewellen, remained
with the City and became the superintendent of the electrical department.
Bonebright’s position description stated that he “[w]ork[ed] under the general
supervision of the city council utility committee and city council.” The
organizational structure for the City further indicated that Bonebright, as a
department head, reported to the council members, the council vice-president, the
council president, and the mayor.
[¶3.] Bonebright’s position description charged him with the responsibility
to “[o]versee[] the safety of assigned maintenance workers and equipment operators
by instructing individuals in proper safety procedures and monitoring work in
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progress.” As is relevant to this appeal, the City’s safety handbook specifically
addressed safety rules and procedures for working in an excavated trench and
required workers to “always ensure that the proper shoring system is in place
before anyone enters the excavation.” Although Bonebright previously
acknowledged the existence of the safety handbook, there was conflicting testimony
as to whether all employees and city council members were aware of the safety
handbook.1
[¶4.] In any event, the City’s safety rules require its employees to secure a
trench deeper than 48 inches either by using the City’s trench box2 or through a
process of sloping3 the sides of the trench. The City purchased its trench box in the
late 1990s at Bonebright’s request after a previous trench collapse during which he
and another employee narrowly averted injury. However, several employees
testified that they used the trench box only once in the succeeding years. Instead,
their practice had been to slope the trenches or, sometimes, do nothing to secure the
trench. This practice—sloping or doing nothing—occurred during the tenures of
both Lewellen and Bonebright as water department superintendent. The City’s
mayor, Ron Blachford, and Tony Rangel, president of the city council and utilities
1. The City’s safety handbook was adopted in 1997.
2. A trench box is a device with steel sidewalls that can be expanded to the
width of a trench and lowered into it to protect workers from cave-ins.
3. Sloping refers to excavating the sides of the trench out using some type of
proportionate ratio relative to the depth of the trench. For instance, one of
the City’s employees testified that the practice was to slope the trench out
one and one-half feet for every foot of depth. The technique is also called
benching, shoring, and feathering in the record.
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committee member, testified that they were aware of the practice. However, the
evidence before the Department established that the City never reprimanded its
employees for not following proper trench excavation safety procedures.4
[¶5.] During the week of July 4-8, 2016, Bonebright was working with city
employees, including Terry Manning and Lewellen, to install a new underground
water main and tap. The project had been contemplated since the late 1990s, but it
became necessary in 2016 because the existing system did not allow the City to shut
water service off to a non-paying customer without affecting other customers. To
accomplish the work, the city employees were replacing sections of pipe that were
13 and 20 feet long in an excavated trench that was approximately seven feet deep.
[¶6.] On the fateful afternoon of July 8, 2016, Bonebright and his crew were
close to completing the project and needed to install one final section of pipe.
Bonebright had decided not to use either the trench box or sloping to shore the sides
of the trench.5 Manning expressed concern about the safety of the trench, as did
Rangel, who was on hand at the project site. To avoid going into the unsecured
trench, Bonebright and Manning decided to use straps to lower the pipe into
position. Before they could rig the straps, however, some dirt fell on the pipe, and
Bonebright went into the trench to shovel the dirt away. The trench partially
4. The City’s employee manual provides that “employee misconduct . . . may
result in . . . disciplinary action up to and including immediate discharge.”
5. Several witnesses testified that the trench box had rusted shut, and
Bonebright was reluctant to slope the sides of the trench because of nearby
underground electrical wires and damage to a wider area of the right of way,
which also served as a road. The City’s expert later testified that sloping the
trench, while more difficult, was still possible.
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collapsed, burying Bonebright’s legs and knocking him over. Manning jumped in to
assist, and the trench collapsed further on top of the two men. After rescue efforts
to recover the men from the trench, they were taken by ambulance to a local
hospital. Bonebright was then airlifted to a Sioux Falls hospital where he died from
his injuries on July 10, 2016.
[¶7.] Bonebright’s widow, Stephanie, requested workers’ compensation
benefits from the City and its workers’ compensation provider, the South Dakota
Municipal League Workers’ Compensation Fund (the Fund). In response, the City
employed Mike Willetts as its expert to investigate the trench collapse. Willetts
opined that the trench collapse could have been prevented if “proper excavation
guidelines” had been followed, “including but not limited to using protective
shoring, sloping or benching methods.” Willetts also thought the City’s trench box
could have been adapted to provide some protection to workers in the trench. Citing
Willetts’ findings, the City and the Fund denied workers’ compensation benefits to
Stephanie, asserting that Bonebright had engaged in willful misconduct. See SDCL
62-4-37 (providing that “[n]o compensation may be allowed for any injury or death
due to the employee’s willful misconduct . . .”).
[¶8.] Acting individually and as the personal representative of her
husband’s estate, Stephanie petitioned the Department of Labor (the Department),
for medical and funeral expenses along with indemnity benefits as a surviving
spouse. After conducting a hearing, the Department denied the City’s willful
misconduct defense and awarded Stephanie benefits. Although it concluded that
Bonebright had engaged in willful misconduct, the Department determined that the
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City had not established that Bonebright’s failure to follow safety precautions was a
proximate cause of his injury and death.
[¶9.] As it related to the willful misconduct determination, the Department
found that “Bonebright’s behavior on the day of the trench collapse indicates he
understood the potential danger of the unsloped trench.” The Department
acknowledged evidence that the City had not enforced its safety rule for securing
trenches, but it concluded that Bonebright was responsible for enforcing the safety
rules. Because Bonebright had decided to leave the trench unsecured in violation of
the City’s safety rules, the Department reasoned that his later decision to get into
the trench constituted willful misconduct.
[¶10.] Despite believing the Department had correctly decided the willful
misconduct issue, the City and the Fund appealed to the circuit court, challenging
the Department’s additional determination that Bonebright’s willful misconduct
was not a proximate cause of his death. By notice of review, Stephanie contended
that the Department erred when it determined that Bonebright had engaged in
willful misconduct. The circuit court affirmed the Department’s determination that
Stephanie was not barred from recovering workers’ compensation benefits, but it
held that the Department clearly erred when it found that Bonebright engaged in
willful misconduct because the City had “habitually disregard[ed] violations of the
safety rule.” Anticipating the possibility of further review, the court also considered
the proximate cause issue and concluded that the City and the Fund had satisfied
their burden to prove causation in the event we reversed the determination that
Bonebright did not engage in willful misconduct.
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[¶11.] The City and the Fund have appealed the circuit court’s decision
regarding willful misconduct, and Stephanie has, by notice of review, challenged the
court’s alternative determination of causation. We restate the issues as follows:
1. Whether the circuit court erred when it determined the
Department committed clear error by deciding that
Bonebright had engaged in willful misconduct.
2. Whether the circuit court erred when it determined the
Department committed clear error by deciding that the
City had failed to establish that the safety violations were
the proximate cause of Bonebright’s injury and death.
Analysis
[¶12.] Our review of administrative agency decisions “is well settled and
governed by SDCL 1-26-37, which provides in relevant part that on review we ‘shall
give the same deference to the findings of fact, conclusions of law, and final
judgment of the circuit court as given to other appeals from the circuit court.’”
Holscher v. Valley Queen Cheese Factory, 2006 S.D. 35, ¶ 28, 713 N.W.2d 555, 564
(quoting SDCL 1-26-37). “However, if the issue is a question of law, the
Department’s actions are fully reviewable by this Court under the de novo
standard.” Id.
[¶13.] “When reviewing findings of fact we apply the clearly erroneous
standard of review, giving great weight to the agency’s findings and inferences
drawn on questions of fact.” Id. ¶ 29. “However, . . . findings based on deposition
testimony and documentary evidence” are reviewed de novo. Id. (quoting Mudlin v.
Hills Materials Co., 2005 S.D. 64, ¶ 5, 698 N.W.2d 67, 71).
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Willful Misconduct
[¶14.] We begin our discussion with the settled principle that South Dakota’s
statutory workers’ compensation system reflects a conscious legislative policy
decision to displace traditional negligence concepts for work-related injuries,
whether offered as theories of recovery or as defenses. We explained the general
rule and its justification over forty years ago:
Work[ers’] compensation legislation is based upon the idea that
the common law rule of liability for personal injuries incident to
the operation of industrial enterprises, based as it is upon the
negligence of the employer, with its defenses of contributory
negligence, fellow servants’ negligence, and assumption of risk,
is inapplicable to modern conditions of employment . . . .
The general purposes of work[ers’] compensation legislation,
therefore, is the substitution in place of the doubtful contest for
a recovery based on proof of the employer’s negligence and the
absence of the common law defenses of a right for the employees
to relief based on the fact of employment, practically automatic
and certain, expeditious and independent of proof of fault and
for the employers a liability which is limited and determinate.
Scissons v. City of Rapid City, 251 N.W.2d 681, 686 (S.D. 1977).
[¶15.] Consequently, employees may recover statutory benefits for workrelated injuries except in limited instances where intentional conduct by an
employer or an employee removes the case from the realm of workers’
compensation. For instance, in exceptional cases where an employee is injured by
an employer’s intentional conduct, the employee is not obligated to accept the
exclusive remedy of workers’ compensation benefits and may instead pursue a tort
claim against the employer. See Fryer v. Kranz, 2000 S.D. 125, ¶ 11, 616 N.W.2d
102, 105-06 (citation omitted) (“Only injuries ‘intentionally inflicted by the
employer’ take the matter outside the exclusivity of workers’ compensation
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coverage.”). More relevant to this case is the somewhat symmetrical idea that
intentional misconduct by an employee can preclude the employee’s right to recover
workers’ compensation benefits. See Holscher, 2006 S.D. 35, ¶ 44 n.2, 713 N.W.2d
at 567-68 n.2 (quoting Phillips v. John Morrell & Co., 484 N.W.2d 527, 532 (S.D.
1992) (Explaining that an employee is barred from recovering workers’
compensation benefits when his actions “constitute serious, deliberate, and
intentional misconduct.”)).
[¶16.] Aptly designated as the willful misconduct defense, this latter rule
allows an employer to avoid workers’ compensation liability for an otherwise
compensable work-related injury if it can establish the injury was caused by the
employee’s willful misconduct. See VanSteenwyk v. Baumgartner Trees &
Landscaping, 2007 S.D. 36, ¶ 12, 731 N.W.2d 214, 219. The statutory basis for the
willful misconduct defense is found in SDCL 62-4-37, which provides in relevant
part that “[n]o compensation may be allowed for any injury or death due to the
employee’s willful misconduct, including . . . willful failure or refusal to use a safety
appliance furnished by the employer, or to perform a duty required by statute.” The
text of SDCL 62-4-37 places “[t]he burden of proof under this section . . . on the
defendant employer,” and we have previously interpreted this provision to mean
that the employer must establish both an employee’s willful misconduct and “that
the injury was incurred ‘due to’ the employee’s willful misconduct.” Holscher, 2006
S.D. 35, ¶¶ 32, 48, 713 N.W.2d at 565, 567 (quoting Wells v. Howe Heating &
Plumbing, Inc., 2004 S.D. 37, ¶ 10, 677 N.W.2d 586, 590).
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[¶17.] “Willful misconduct under the workers’ compensation statutory scheme
‘contemplates the intentional doing of something with the knowledge that it is likely
to result in serious injuries, or with reckless disregard of its probable
consequences.’” Id. ¶ 48, 713 N.W.2d at 567 (quoting Fenner v. Trimac Transp.,
Inc., 1996 S.D. 121, ¶ 9, 554 N.W.2d 485, 487-88). We have applied a four-part test
to determine whether the employee’s violation of safety rules constituted willful
misconduct. Id. ¶ 49, 713 N.W.2d at 568-69 (citing 2 Larson’s Workers’
Compensation Law § 35.01). To prevail, an employer must show that:
(1) the employee [had] actual knowledge of the rule or appliance,
and its purpose;
(2) the employee [had] an actual understanding of the danger
involved in the violation of the rule or failure to use the
appliance;
(3) the rule or use of the appliance must be kept alive by bona
fide enforcement by the employer; and
(4) the employee had no valid excuse for violating the rule or
failing to use the appliance.
Id. (citing 2 Larson’s Workers’ Compensation Law §§ 35.01-.04).6
6. The third edition of Larson’s Workers’ Compensation applies a similar threepart test, but the parties have not directly asked us to adopt it in this case.
See 3 Larson’s Workers’ Compensation Law §§ 35.02-.04. Stephanie has
asked that we clarify the fourth part of the Holscher test to reflect what she
believes to be a more accurate application of Professor Larson’s exposition of
the employer’s willful misconduct defense. In her view, the requirement for
an employer to show the employee had no valid excuse for violating a safety
rule or failing to use a safety appliance could incorrectly allow the willful
misconduct defense in instances where an employee has a plausible, but
faulty, reason to explain the violation. However, given our analysis under
Holscher’s third element, it is unnecessary to consider this argument further.
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[¶18.] We applied this test in Holscher where we held that the claimant had
engaged in willful misconduct by violating a safety rule that prohibited propping
open a valve used to dispense acid for cleaning. Id. ¶ 54, 713 N.W.2d at 569. The
claimant could not, therefore, recover benefits for injuries caused by a resulting acid
spill. Central to our determination was the fact that the claimant’s employer had
actively enforced the safety rule by reprimanding the claimant for an earlier
violation and by terminating another employee for violating the rule. Id. ¶¶ 10-15,
713 N.W.2d at 560-61. The employer had also emphasized the importance of the
rule by hanging signs and restricting access to the room where the acid was stored.
Id. ¶ 52, 713 N.W.2d at 569.
[¶19.] Here, the Department utilized the four-part test from Holscher to
determine that Bonebright had engaged in willful misconduct. Through her notice
of review to the circuit court, Stephanie argued the Department clearly erred when
it determined that the third and fourth parts of the test were met.7 The circuit
court accepted the argument in part and determined that Bonebright had not
engaged in willful misconduct because the City had failed to meet the third part of
the Holscher test by demonstrating that it kept the safety rule alive through bona
fide enforcement.
[¶20.] We conclude that the circuit court correctly reversed the Department’s
willful misconduct finding. The undisputed facts contained in the record
demonstrate that the City did not enforce its safety rules for securing trenches,
7. The first and second parts of the test are, for the most part, not disputed by
the parties. Bonebright’s actions demonstrated that he had knowledge of the
safety rules and understood the danger posed by an unsecured trench.
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either historically or at the time of Bonebright’s death. Even though several city
council members, the mayor, and the electrical department superintendent,
Lewellen, were present at the job site at various times on July 8, no one ordered the
project stopped or reprimanded Bonebright for his failure to follow trench
excavation safety rules. This, despite the provisions of the City’s safety handbook
and well-founded concerns regarding the risk posed by the trench.
[¶21.] More illuminating, and in stark contrast to the facts in Holscher, is the
fact that the City never reprimanded its employees for not using the trench box or
sloping the sides of a trench. Testimony contained in the record suggests that the
city officials may have been unaware of the safety handbook’s existence and did not
believe they had the authority to reprimand Bonebright. However, even if this
testimony were credited, it does not change or excuse the inarguable fact that the
City did not undertake a bona fide effort to enforce the safety rule for securing
trenches over 48 inches deep.
[¶22.] The circuit court’s decision further rejected the Department’s
determination that the City could demonstrate bona fide enforcement by delegating
enforcement to Bonebright and finding fault with his lack of compliance:
[T]he Department’s decision appears to recognize that the City
clearly had not been enforcing the policies in the [s]afety
[h]andbook[] given the City official’s knowledge of instances
where neither a trench box nor sloping were being utilized in
excavations. But rather than finding that the City did not keep
the safety rule or use of the safety device alive by bona fide
enforcement, the Department instead shifted the focus toward
Bonebright’s responsibility to ensure the projects were safe.
[¶23.] We share the circuit court’s concern with the Department’s reasoning,
which we view as coming perilously close to the prohibited concept of contributory
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negligence or fault. Determining whether an employee can be charged with willful
misconduct and consequently denied statutory workers’ compensation benefits
involves a different and more comprehensive inquiry under our Holscher analysis,
which includes scrutinizing the enforcement of established safety rules. This
examination, as our decision here illustrates, is fixed firmly upon the efforts of the
employer, not the employee. See Holscher, 2006 S.D. 35, ¶¶ 50-52, 713 N.W.2d at
569 (detailing employers’ efforts to enforce its safety ruled). A different view could
introduce a comparative fault element into workers’ compensation disputes and
effectively allow employers to disclaim liability based solely on the existence of
safety rules without regard to their efforts to enforce them
Outcome: The circuit court did not err when it reversed the Department’s
determination on bona fide enforcement and proximate cause. Stephanie’s workers’
compensation claim is not precluded by willful misconduct because the City did not
demonstrate bona fide enforcement of its safety rules. Given this disposition, it is
unnecessary to address the question of proximate cause. We affirm.
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