Lowery v. McCormick Asbestos Co.

W. ALBERT MENCHINE, Retired, Specially Assigned Judge. Lucille P. Lowery, as widow and personal representative of George W. Lowery, instituted an action in the Superior Court of Baltimore City (now Circuit Court for Baltimore City) against McCormick Asbestos Company and fourteen other corporations for negligence and strict liability in tort. The declaration was in four counts—the first and second as surviving widow against each defendant for negligence and for strict liability in tort respectively—the third and fourth as personal representative of the decedent against each defendant for negligence and for strict liability in tort. The gravamen of the action was that each defendant, as manufacturer, fabricator, distributor, supplier and seller of asbestos and asbestos products reaching the decedent without substantial change, knew or should have known of the danger inherent in exposure to such products yet failed to warn decedent of such danger as a result whereof decedent, in the course of his employment as an asbestos insulator in Maryland and other states from 1935 to 1975, was exposed to such danger and thereby was caused ³⁰ to suffer painful and debilitating illness in June 1980, directly causing his death on February lip, 1982.

Gross negligence was alleged in both personal representative counts and punitive damages were claimed therein. McCormick Asbestos Company, one of the defendants, filed a motion for summary judgment supported by affidavit that George W. Lowery, the decedent, was its employee during four employment periods, i.e., from July 20 to July 27, 1943; April 2 to July 30, 1950; June 12 to November 15, 1962; and March 1 to April 26, 1970, and it had complied with the provisions of the Workmen’s Compensation Act during all such periods of employment. The motion for summary judgment was grounded upon a contention that the decedent was its employee and that “Plaintiff’s remedy against the Defendant, McCormick Asbestos Company, is limited to and is found exclusively in Article 101 of the Annotated Code of Maryland.” Responding to the motion for summary judgment, the plaintiff said: “1. That the last employer for whom the Plaintiff worked in whose employ he sustained his last injurious exposure to asbestos dust was Wallace & Gale.[ 1 ] 2.

That although Plaintiff did work at times for the Defendant, McCormick Asbestos Company, McCormick would not be responsible under the compensation scheme therefore it is not immune from third party liability.” There is no allegation in the declaration and no contention is made in the response to the motion for summary judgment that the decedent was subjected to exposure to asbestos dust by McCormick Asbestos Company at any other time than during the periods of his actual employment by that company. The declaration alleges that exposure during those periods of employment was causally related to the illness and death of the decedent. ³¹ The trial judge concluded “that the employer’s compliance with the Act rather than the fact of liability for payment of compensation, triggers the exclusivity provision.” The motion for summary judgment was granted and the clerk was directed to enter final judgment for McCormick pursuant to Maryland Rule 605 a. Plaintiff appealed. We issued a writ of certiorari prior to any proceedings in the Court of Special Appeals.

The initial legislation by which specified occupational diseases were brought within the purview of the Workmen’s Compensation Act (Maryland Code (1957, 1979 Repl. Vol.) Art. 101) was enacted by ch. 465, Acts of 1939. The Legislature adopted the “last injurious exposure rule” under which the date of disability was fixed as the date upon which a right to benefits would accrue 2 and liability was assigned to “the employer in whose employment the employee was last injuriously exposed to the hazards of such disease.” 3 The title of ch. 465, Acts 1939, included inter alia the following description of its purpose: “[PJroviding that occupational diseases as defined therein shall be compensable under the Workmen’s Compensation Act, enumerating the occupational diseases covered, creating a Medical Board to hear and pass upon cases involving medical questions as to occupational diseases ³² and prescribing its duties and powers, relating to appeals in cases involving occupational diseases, providing that ‘injury’, ‘personal injury’, and ‘accidental personal injury ’ shall include the occupational diseases enumerated .... ” (Emphasis added.) ■ Neither the initial Occupational Disease Act, nor the subsequent amendments which provided complete, coverage for all occupational diseases and increased the benefits therefor, changed any of the exclusivity provisions of the Workmen’s Compensation Act. Nevertheless, appellant contends that “under the facts of the instant case McCormick was a stranger to any compensation proceedings and was outside the coverage of the Act.

And in Section 58 of the Act, providing for third party suits against 'some person other than the employer’ the reference is clearly to persons other than the employer liable under the Act to provide compensation.” Otherwise stated, appellant’s contention is, that by adopting and retaining the last injurious exposure rule the Legislature implicitly amended the exclusivity provisions of the compensation act in occupational disease cases so that all causal employers other than the last are amenable to suit as third party tortfeasors under Art. 101, § 58. 4 In Osteen v. A.C. & S., Inc., 209 Neb. 282 , 307 N.W.2d 514 (1981), the Supreme Court of Nebraska, faced with a silent statute, said: ³³ “Appellant next argues that the Workmen’s Compensation Court erred in applying the so-called ‘last injurious exposure’ rule to determine which employer should bear liability for payment of the award. According to this rule, where a worker has contracted an occupational disease by exposure to a harmful substance over a period of years in the course of successive employments, the employer who most recently exposed the worker to the harmful substance is liable to pay the entire award. 4 Larson, Workmen’s Compensation Laws § 95.21 (1981). In some states, this rule is codified by statute.” 307 N.W.2d at 518 . Maryland is such a state.

Article 101, §§ 22(a) and 23(b). In Shifflett v. Powhattan Mining Co., 293 Md. 198 , 442 A.2d 980 (1982), Judge Rodowsky, speaking for this Court said: “The General Assembly has chosen the time when disability results from an occupational disease as the point at which the disease becomes compensable.... “... But it is the employer in whose employment the employee was last injuriously exposed to the hazards of the occupational disease, and the insurance carrier on the risk at that time, who are liable for the compensation.” 293 Md. at 201-02 , 442 A.2d at 982 . The Court in Osteen v. A.C. & S., Inc. went on to say: “[I]t is almost impossible to pinpoint which exposure ‘caused’ the disease, since the claimant’s expert medical witnesses agreed that no exposure to asbestos could be exonerated as the cause of the tumor.

Thus, we are unable to assign liability to the employer whose exposure of Mr. Osteen to asbestos ‘caused’ his occupational disease, since the inception of the disease cannot be pinpointed and, additionally, since it is believed that cumulative exposures are harmful as well. The application of the last injurious exposure rule eliminates this guesswork. As stated in Tennessee Tufting Co. v. Potter, 206 Tenn. ³⁴ 620, 630, 337 S.W.2d 601 , 602 (1960), a case from a state where this rule is statutory, the purpose of the rule is ‘to avoid the issue when the disease or disability came into existence, which issue often involves difficulty, uncertainty and speculation.’ ” 307 N.W.2d at 519 . The “last injurious exposure rule” was not new when the Legislature adopted it as the law of Maryland.

Its purpose and effect was the subject of judicial discussion years before its enactment in Maryland. In Wisconsin, occupational diseases were brought within the purview of the Workmen’s Compensation Act in 1919. 5 The initial Wisconsin statute lacked a provision fixing with specificity a date that triggered the respective rights, duties and responsibilities of employer and employee in occupational disease cases. In Employers Mut. Liability Ins.

Co. v. McCormick, 195 Wis. 410 , 217 N.W. 738 (1928), the Wisconsin Supreme Court observed that the general provisions of the Workmen’s Compensation law provided a definite date—that of the accident—for the determination of the respective rights, duties and obligations of employers and employees but that the inception of occupational disease admitted to no such definitive basis for such determination. The Court filled the void in the Wisconsin occupational disease statute by fixing the date of disability as the determinant of a right to compensation benefits and adopting, as judicial doctrine, the last injurious exposure rule to impose liability solely upon the last causal employer. The Court thus explained its decision: “Unless the date when the employee is disabled from rendering further service be taken as the date that determines liability, it will be very difficult to administer the Workmen’s Compensation Act so far as disability resulting from occupational disease is concerned. The protection of the rights of both the employer and the employee ³⁵ requires that liability be fixed as of that date.

If liability must be determined as of the date when the disease had its inception, the employee would be under the necessity of giving notice of every slight ailment, which might be the incipient stage of some occupational disease that might cause disability at some more or less distant future time, and the employer would be put to the needless expense of investigating all such notices of claims. “Unless the Workmen’s Compensation Act be construed to permit the giving of notice of claim for compensation for disability resulting from occupational diseases within 30 days from the date of disability, employees who are entitled to compensation because of disability caused by such diseases might find their claims barred by the failure to give this 30-day notice, because the inception and progress of most occupational diseases is insidious and slow. Their inception would be a matter difficult to determine, and must in most cases be left to the opinion of experts who can never have definite knowledge as to the date when the disease had its inception.” 195 Wis. at 414-15 , 217 N.W. 738 . The Court in Employers Mutual, manifestly conscious of the heavy burden of liability arbitrarily assigned by the rule solely upon the last causal employer, explained why the rule did no affront to fundamental fairness, saying: “This rule will work no injustice to any individual carrier or employer, because the law of averages will equalize burdens imposed by this act among the employers and the compensation insurers of the state.” 195 Wis. at 415-16 , 217 N.W. 738 (emphasis added). The Wisconsin Legislature subsequently incorporated the judicial doctrine within the Workmen’s Compensation Statute. 6 It is beyond question that the last injurious exposure rule, arbitrarily imposed upon the last causal employer, if con ³⁶ sidered in the context of its application to a single case, is frequently unfair to employers as the following will illustrate: Wil lingham v. Bryan Rock & Sand Co., 240 N.C. 281 , 82 S.E.2d 68 (1954) (Sole liability assigned to last injurious exposure employer for whom claimant worked only months.

The claim against the employer for whom he worked 15 to 20 years was dismissed.); Gregory v. Peabody Coal Co., et al., 355 S.W.2d 156 (Ky.1962) (Sole liability assigned to last exposure employer for whom claimant worked only 25 days. The claim against the employer for whom he worked 30 years was dismissed.). Decisions in jurisdictions adhering to the rule have made it quite clear, however; that it must not be considered in such a context. In Travelers Insurance Co. v. Cardillo, 225 F.2d 137 (2nd Cir.1955), cert. denied, 350 U.S. 913 , 76 S.Ct. 196 , 100 L.Ed. 800 (1955), the court adopted the “last injurious exposure rule” as a judicial doctrine applicable to the silent Longshoremen and Harborworkers Act, 33 U.S.C.A., § 901 et seq.

(1979), saying: “Every claim based upon occupational disease would be barred if the one year limitation period were declared to begin running when contact is first had with the condition causing the disease or when the disease first ensues. At such a time, a potential claimant would have no occasion to realize that there is anything wrong with him, much less that he had suffered damage industrially caused.” 225 F.2d at 143 . Judge Medina for the Court then pointed out that in the course of the Act’s passage Congress had been made aware that the Act contained no provision limiting the proportion of the total award for which a particular employer could be held liable and that absent such a provision a “last employer” could be liable “even if the length of employment was so slight that medically, the injury would, in all probability, not be attributable to that last employment.” 225 F.2d at 145 (footnote omitted). Pointing out that Congress declined to amend, Judge Medina observed: ³⁷ “[I]t would seem a fair inference that the failure to amend was based upon a realization of the difficulties and delays which would inhere in the administration of the Act, were such a provision incorporated into it.

Thus we conclude that the Congress intended that the employer during the last employment in which the claimant was exposed to injurious stimuli, prior to the date upon which the claimant became aware of the fact that he was suffering from an occupational disease arising naturally out of his employment, should be liable for the full amount of the award.” Id. at 145 . Accord Cordero v. Triple A Machine Shop, 580 F.2d 1331 (9th Cir.1978), cert. denied, 440 U.S. 911 , 99 S.Ct. 1223 , 59 L.Ed.2d 459 (1979), wherein it was contended, inter alia, that the due process rights of the last employer “are violated by assessing full disability liability against the last employer.” 580 F.2d at 1336 . Rejecting the contention, the Court cited with approval Travelers Ins. Co. v. Cardillo, and said: “There, the court noted that administrative convenience made the last employer doctrine legally acceptable.

The underlying rationale is that all employers will be the last employer a proportionate share of the time. In arriving at its decision, the Cardillo court fully examined the legislative history of the Act and held that this concept was allowable.” Id. at 1336 (emphasis added). See also Osteen v. A.C. & S., Inc., wherein the Supreme Court of Nebraska, affirming the judgment of that state’s Workmen’s Compensation Court, quoted with approval from that court’s opinion: “ ‘[E]ven though liability imposed under this rule can have a harsh result, there will be a spreading of the risk when the total picture of asbestos litigation is considered and this rule is applied on a nationwide basis.’ ” 307 N.W.2d at 520 . In Mathis v. State Accident Insurance Fund, 10 Or.App. 139 , 499 P.2d 1331 (1972), the intermediate appellate court of Oregon, after pointing out that asbestosis is not readily susceptible to evidence demonstrably fixing the date of ³⁸ contraction of the disease or providing guidance for allocation of liability as between causative employers, adopted the “last injurious exposure rule” as judicial doctrine.

The Court observed that adoption of any other rule would require a disabled claimant to choose among multiple causative employers—perhaps to the defeat of a valid claim. In Inkley v. Forest Fiber Products Co., 288 Or. 337 , 605 P.2d 1175 (1980), the Supreme Court of Oregon approved the holding in Mathis, supra. After noting that claimants in multiple employer situations need to know against which employer or carrier to file a claim, the court rejected the “causality rule” and declared: “In the multiple employer situation, however, such a ‘causality rule’ would expose the claimant to the risk of no recovery, if his initial judgment as to which job had the strongest causal relation to his illness proved faulty. “The inequity of denying a disabled worker his benefits under the statute because he mistakenly filed against the wrong employer influenced the Court of Appeals [in Mathis ] to adopt the last injurious exposure rule. Under the rule an occupational disease claimant must show that his condition arose ‘out of and in the scope of the employment,’ ORS 656.802(l)(a), but he need not meet the often impossible burden of showing that workplace conditions at a specific time and place caused or materially aggravated his condition.

The rule requires that claimant to show only that the employment environment during the relevant period could have been a contributory cause of the disease. That question is more susceptible to proof in a WCB proceeding than is the question of whether the workplace did cause the disease.” 288 Or. at 343-44 , 605 P.2d 1175 (emphasis added). In the later case of In re Compensation of Bracke, 293 Or. 239 , 646 P.2d 1330 (1982), the Supreme Court of Oregon discussed in greater depth the rationale of its judicially adopted “last injurious exposure rule”: ³⁹ “The Workers’ Compensation Act makes no provision for allocation of liability among employers. It is desirable in occupational disease cases to designate an identifiable event for the assignment of liability, analogous to accidents in injury cases, to reduce uncertainty____ “...

The last injurious exposure rule of proof more typically applies where one employment caused the disease, but more than one could have. By arbitrarily assigning liability to the last employment which could have caused the disease, the rule satisfies claimant’s burden of proof of actual causation. The reason for the rules lies not in their achievement of individualized justice, but rather in their utility in spreading liability fairly among employers by the law of averages and in reducing litigation. •j: sf: sjs s]s s]« “The operation of the rule, as we said in Inkley , provides certainty in a way which is ‘somewhat arbitrary.’ It operates generally for the benefit of the interests of claimants. It is fair to employers only if it is applied consistently so that liability is spread proportionately among employers by operation of the law of averages.

We hold that employers have and may assert an interest in the consistent application of the last injurious exposure rules, either as to proof or liability, so as to assure that they are not assigned disproportionate shares of liability relative to other employers who provide working conditions which generate similar risk.” 646 P.2d at 1335-37 (footnotes omitted). In 4 Larson, Workmen’s Compensation Law, § 95.21 pages 17-82 to 17-86 (1981), the author puts in capsule form the advantages stemming from the rule’s adoption: “Occupational disease cases typically show a long history of exposure without actual disability, culminating in the enforced cessation of work on a definite date. In the search for an identifiable instant in time which can perform such necessary functions as to start claim periods ⁴⁰ running, establish claimant’s right to benefits, determine which year’s statute applies, and fix the employer and insurer liable for compensation, the date of disability has been found the most satisfactory. Legally, it is the moment at which the right to benefits accrues; as to limitations, it is the moment at which in most instances the claimant ought to know he has a compensable claim; and, as to successive insurers, it has the one cardinal merit of being definite, while such other possible dates as that of the actual contraction .of the disease are usually not susceptible to positive demonstration.” We glean from the cited authorities that the last injurious exposure rule provides assurance that claimants who are disabled by an occupational disease will receive the benefits to which they are entitled by assignment of liability solely to the last causal employer.

The cases emphasize, however, that the rule will be fair to employers only if applied uniformly and universally so that, under the law of averages, the burden of liability will be spread equally among all employers whose workplaces present similar hazards. We have heretofore observed that the Legislature has never amended the specific exclusivity provisions of the compensation act. Those provisions are to be found in the preamble to the initial Workmen's Compensation Act in Maryland 7 in Article 101, § 15, that in pertinent part pro ⁴¹ vides that “[t]he liability ... [of an employer complying with the Act] shall be exclusive ....” and in Article 101, § 36, that in pertinent part provides that “Each employee (or in the case of death his family or dependents) entitled to receive compensation under this article shall receive the same in accordance with the following schedule and except as in this article otherwise provided, such payment shall be in lieu of any and all rights of action whatsoever against any person whomsoever.” In Victory Sparkler Co. v. Francks, 147 Md. 368 , 128 A. 635 (1925), this Court in commenting upon the preamble of the initial statute said: “[T]he Legislature could not have gone much further in stressing its intention to make the terms of the law exclusive within its indicated scope. Furthermore, this preliminary declaration is, in substance, incorporated in the text of the act.” 147 Md. at 374 , 128 A. 635 .

Judge Parke speaking for this Court then referred to the exclusivity provisions of the statute previously cited herein 8 and declared: “When these various sections are considered together, in connection with the preliminary paragraphs of the act, ⁴² the meaning is so clear and unmistakable that it would be a denial of the legislative purpose to strike their plain terms from the statute by judicial construction. An exact parallel in facts with this case is not found in the reported decisions of this tribunal, but whenever this Court has spoken on any phase of this subject, it has uniformly said that, aside from the exceptions created by the act itself, the