Spring, 1999, Final Exam, Problem #1

Mary Goforth and Herman Bengone had been operating a tile shop, together for several years, and for the last year and a half, had been living together. Mary was in charge of the shop, doing all the ordering and Herman was primarily involved in installation. He had no special license and had never heard of the Business and Professions Code. On June 1, 1993, George Hanzon came into the shop to order some tiles. Both Mary and Herman were in the shop at the time and George introduced himself and told them he was a general contractor and his clients had selected a particular pattern, which could be purchased at the shop. He also said that the tile setter he had been using had disappeared and he looking for a new one. Herman said he was the man and he and George started negotiating. Herman had his own tools and a truck. George told him he was remodeling a house in the Lake Tahoe area on the Nevada side of the border and needed Herman's services immediately. They agreed that Herman would leave Napa, California, the next day and bring with him the tiles that had been selected and his tools in his truck. It was estimated that it would take about four hours to get to the job site and Herman was to be paid at the hourly rate of $20.00. It was further agreed that George would give Herman a check for the tiles once he delivered them at the house. Herman was to install the tiles. It was estimated that the installation would take a week and Herman would be paid at the rate of $25.00 per hour. Herman would sleep on the premises and act as a watchman during the night.

On June 2, 1993, Herman told Mary goodbye and that he would see her soon. She was to take care of the shop.

Herman was hardly out of town when he noticed that the brakes, which had just been repaired at a neighborhood brake shop, were acting strangely, but he figured he could get to Tahoe. While going down a long grade, in California, he applied the brakes and found they had gone out. The truck gathered momentum and near the bottom, Herman lost control and the truck went off the highway and into a deep gorge. Herman was pulled out of the wreckage and taken by ambulance to a hospital in Reno, Nevada. It was determined that Herman had sustained injuries to his head, chest, fractures of his right arm and left leg, all of which leave him with serious permanent disabilities.
Mary contacts you to represent her and Herman in regard to his various injuries. What is your advice to them concerning workers' compensation benefits?

Assume the following changes in the facts: The homeowner, in Nevada, was to have the last word in hiring Herman, after he had seen photographs of his work, which Herman was bringing with him.

Eventually, Herman was released from the hospital and transported home. He was to have complete bed-rest and 24-hour care for the first three months. Mary, who had been a nurse, was approved by the treating physician to render this 24-hour care.

Before this accident, Herman had needed and used a leg brace on his right leg due to a childhood injury.

Now, what is your advice to Mary? Do you have any advice for George, assuming no conflict?

On June 1, 1994, Annie Omyo was employed by Elia's Electric Company of Berkeley, as a warehouse worker. She had been with the firm for about three years. On the day in question, Ella, the boss, told her she was needed in the office to help with the clerical work. When working in the warehouse, Ella operated a forklift and for the better time on the job she sat in the vehicle, but on occasion she would have to move various items by hand. These materials were heavy and there was no help available. Often, at the end of the day, her back would hurt and she would take some overthe-counter pain reliever, which usually gave her some relief.

She reported for work in the office, as requested. Her job consisted primarily of answering the telephone and filing various bills and receipts. The filing cabinets were at various heights, from floor to ceiling. During the second week, June 13, she bent over to retrieve a file and was visited by a sharp pain in the low back and was virtually unable to straighten up. She let out a shriek and Ella came running to see what was going on. She took one look and Annie and called an ambulance. After a couple of months at home, she was released to return to work, but was told to do no more than light work. She and Ella were convinced the work in the office was light and the doctor agreed. She worked for two months and, finally, could not stand the increasing pain. She quit work and found a job as a grocery clerk at Great Foods. When she had a pre-employment physical examination by the doctor for Great Foods, she neglected to tell her about her previous back problem.

She was hired to work as a checker, but on occasion would have to stock shelves. She would go home tired at the end of the day and with some pain in the low back. She still had pain medication left over from the prior problem and this did give her relief.

On December 3, 1994, she was on a ladder restocking the shelves when she had a spasm in her low back and she fell from the ladder, breaking her left leg and her right wrist. She also sustained head injuries and would never be able to recall exactly what happened. She was rushed to the hospital.

Her physician advised her to have back surgery, as soon as possible, after her broken leg and wrist healed. The doctor told her she had x-ray evidence of a spinal problem that had to have been there for years and, according to her history was aggravated by the work she had done over the years. It was not helped by the fall from the ladder.

Great Foods denied her claim. Annie calls you on December 6, 1995 and asks for your help in getting the doctor and hospital paid, and, in general, asks what her rights are concerning Ella and Great Foods.

Without any conflict problem, what advice do you give to representatives of Ella's insurance carrier and Great Foods' insurance carrier, respectively?

Assume that Annie undergoes the prescribed surgery but, because of a little slip of the knife is rendered a paraplegic and unable to walk.  Does this change any of your advice given to each of the three parties?

Assume Annie calls you on October 5, 1995. How does this change your advice to any of the parties, if at all?