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Joan A. Para et al. v. The Richards Group of Washington Limited Partnership et al., No. 131, 1994 Term WORKERS COMPENSATION -- Where an owner/developer, in the business of constructing homes for resale to the public, contracts with a subcontractor to do part of the construction work and it is understood that homes will be sold during construction, after the first home sales contract is signed, owner/developer is a statutory employer of subcontractor's employees.

IN THE COURT OF APPEALS OF MARYLAND No. 131 September Term, 1994 ___________________________________

JOAN A. PARA et al. v. THE RICHARDS GROUP OF WASHINGTON LIMITED PARTNERSHIP et al.

___________________________________

Eldridge Rodowsky Chasanow Karwacki Bell Raker JJ. ___________________________________ Opinion by Chasanow, J. ___________________________________ Filed: July 20, 1995

In the instant case, we must determine whether the owner and developer of a housing development who serves as the general contractor can be considered a statutory employer under the

Maryland Workers' Compensation Act and whether, because of the statutory employer status, can be immune from tort liability in a suit arising out of the death of a subcontractor's employee. We

hold that in the instant case, the owner/developer is a statutory employer and is therefore immune from tort liability.

I. On December 21, 1989, The Richards Group of Washington, Limited Partnership ("Richards"), an owner and developer of new home sites, signed a contract with Razzano & Fohner, Inc. ("Razzano & Fohner") to do plumbing work on the houses under construction in section five of a new home development called Crofton Village, located in Anne Arundel County. The property on which the work was Under the terms of this

to be done was owned by Richards.

contract, Richards was known as the "contractor" on the Crofton Village project and Razzano & Fohner was designated as the

"subcontractor." working on the

Additionally, the contract required that while project, Razzano & Fohner maintain workers'

compensation insurance covering its employees and that Richards be listed as a named insured on Razzano & Fohner's insurance policy. On February 2, 1991, prior to the accident giving rise to this cause of action, Richards entered into a contract for the sale of

-2lot 37, section 5 of Crofton Village subdivision with Joseph and Lily Chang ("the Chang Contract"). This contract was later voided,

subsequent to the accident in question, when Richards learned that the Changs intended to use the property for investment purposes. After the accident, on August 23, 1991, Richards entered into a contract of sale for lot 37, section 5 with Thomas Harrington and Rebecca Ebeling. On March 19, 1991, Brian Para, an employee of Razzano & Fohner, who was performing excavation and trenching work on lot 37, section 5 in connection with Razzano & Fohner's contract with Richards, was killed when the trench in which he was working collapsed. Joan Para, as executrix of her son's estate and

individually with her husband, Carl Para, brought suit against Richards, County in Enterprise the Washington Court Corporation, Anne and Anne Arundel The

Circuit

for

Arundel

County.1

complaint alleged counts for negligence and wrongful death against each of the parties. The complaint identified Richards as being in

the "business of promoting and supplying general and specialized

Enterprise Washington Corporation was the general partner of the Richards Group. Following the grant of summary judgment as to Richards, summary judgment was granted in favor of Enterprise on June 17, 1994. The Para's argued in their complaint that Anne Arundel County was negligent in that the agents of the county who inspected the site "knew or through the exercise of reasonable care should have known, that the soil of the premises known as Crofton Village was sandy and exceedingly unstable, thereby rendering any trenching or excavation work performed on it inherently dangerous and hazardous." Anne Arundel County's liability is not before this Court on the present appeal.

1

-3contracting townhouses contractor[] services and in in the construction and of as condominiums, the of "general

residential the

homesites" and

construction

erection In

residential to the

homesites in ... `Crofton Village.'"

response

complaint, Richards filed a motion for summary judgment contending that it was entitled to judgment as a matter of law because, under the then existing codification of the statutory employer provision of the Maryland Workers' Compensation Act, Maryland Code (1957, 1985 Repl. Vol., 1990 Cum. Supp.), Article 101,

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