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Filed 7/18/03
CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION THREE

RAY KINSMAN et al.,

Plaintiffs
and
Respondents,

A093424
v.
A093649
UNOCAL CORPORATION,

(San Francisco County

Defendant and Appellant.

Super. Ct. No. 308646)

This case presents an unsettled question under Privette v. Superior Court (1993) 5
Cal.4th 689 (Privette) and its progeny: Under what circumstances, if any, may a
premises owner be held liable for injuries sustained by the employee of an independent
contractor due to a dangerous condition on the owner's property? Based on the policies
expressed in Privette and the Supreme Court's application of those policies in recent
cases, we conclude a premises owner has no liability to an independent contractor's
employee for a dangerous condition a contractor has created on the property unless the
dangerous condition was within the property owner's control and the owner exercised
this control in a manner that affirmatively contributed to the employee's injury. Because
the jury instructions in this case did not reflect these limitations on the premises owner's
liability, we reverse for a new trial.1

1
In light of our decision on this ground, we do not address Unocal's remaining arguments
on appeal.

BACKGROUND

During the 1950's, plaintiff Ray Kinsman worked on many occasions as a
carpenter at defendant Unocal's refinery in Wilmington, California. Kinsman was
employed by Burke & Reynolds, an independent contractor Unocal hired to perform
scaffolding work during periods of "shutdown" and repair at the refinery. Kinsman built
and dismantled scaffolding used by other trades, including pipefitters and insulators.
This work exposed him to airborne asbestos, which was produced by other trades--
particularly insulators--during their application and removal of asbestos-containing
insulation from pipes and machinery. Though Kinsman did not work directly with such
insulation, the evidence showed he was exposed to asbestos dust in three ways: (1) When
insulators worked on scaffolding, asbestos-containing debris accumulated on the planks.
Kinsman was exposed to this asbestos material when he cleared debris from the planks in
dismantling used scaffolding. (2) Some asbestos dust was produced from Kinsman's
work "tying in" scaffolding to insulated pipes or equipment. (3) Asbestos fibers released
by the work of other trades "float[ed] in the air," exposing Kinsman as he worked
nearby. Kinsman did not wear a mask or respirator at Unocal.

Years later, Kinsman developed mesothelioma, an asbestos-induced malignant
cancer of the lining of the lungs. He sued scores of product manufacturers and
distributors, as well as several premises owners. Ultimately, the case proceeded to a jury
trial against Unocal, a "premises defendant," alone. The parties stipulated that Kinsman
was exposed to asbestos during his work at Unocal. In addition, following
uncontroverted expert testimony that labeled this exposure a "substantial factor"
contributing to Kinsman's development of mesothelioma, the trial court granted a
directed verdict for Kinsman on the issue of causation. Because the parties also
stipulated Kinsman bore no contributory fault, the only disputed issues before the jury
concerned whether, and to what extent, Unocal was negligent, whether Kinsman's wife
suffered a loss of consortium, and the amount of damages suffered by the Kinsmans.

Kinsman claimed Unocal was negligent because, in the 1950's, the company knew
or should have known that asbestos was hazardous, but it failed to warn Kinsman or

2

protect him from the hazard. To show Unocal's knowledge, Kinsman relied on several
published articles in the 1930's and 1940's linking asbestos with asbestosis, lung cancer
and mesothelioma, and reports distributed by other oil companies and oil industry
associations in the 1940's and 1950's that described the risks associated with asbestos
exposure. Given Unocal's access to these published articles and reports and its
membership in oil industry associations, Kinsman's expert testified that, in the 1950's, oil
companies such as Unocal knew or should have known asbestos posed a risk of harm to
refinery workers. Despite this knowledge, Unocal never warned Kinsman about the
danger of asbestos exposure and did not provide him with a mask to wear for protection.
Kinsman testified, however, that he would have asked his employer, Burke & Reynolds,
for a mask if he wanted one. He also testified that Burke & Reynolds never discussed the
health risks of asbestos at its safety meetings.

Kinsman submitted his case on two theories of Unocal's liability: (1) negligence
"in the use, maintenance or management of the areas where Ray Kinsman worked," and
(2) negligence in the exercise of retained control over "the methods of the work or the
manner of the work performed by . . . Ray Kinsman." The jury found Unocal did not
retain control over the methods or manner of Kinsman's work, and thus did not reach the
question of negligence under the "retained control" theory; however, the jury concluded
Unocal was negligent in the "use, maintenance or management" of the refinery. It
assigned Unocal 15 percent of the fault in causing Kinsman's mesothelioma, with the
remaining 85 percent of fault attributable to "all others," and awarded the plaintiffs over
$3 million in compensatory damages.

Unocal separately appealed from the judgment on the jury verdict and the court's
denial of its motion for judgment notwithstanding the verdict. We consolidated the
appeals for briefing and oral argument.
DISCUSSION
I.
Premises Owner's Liability to Employees of Independent Contractor

Unocal contends the BAJI 8.01 instruction read to the jury in connection with the
negligent maintenance of property claim did not properly define the duty of care owed by

3

Unocal, a premises owner, to Kinsman, an independent contractor's employee.
Specifically, Unocal asserts the instruction failed to reflect the policy-based limitations
on liability established in the line of cases under Privette, supra, 5 Cal.4th 689. We begin
our discussion with a brief review of these cases.

A.
Relevant Supreme Court Precedents

The general rule at common law is that the hirer2 of an independent contractor is
not liable to third parties for physical injuries caused by the contractor's negligence in
performing the work. (Rest.2d Torts, � 409; Privette, supra, 5 Cal.4th at p. 693.)
However, "[o]ver time, the courts have, for policy reasons, created so many exceptions to
this general rule of nonliability that ` " `the rule is now primarily important as a preamble
to the catalog of its exceptions.' " ' [Citations.]" (Privette, supra, at p. 693.)
In
Privette, the Supreme Court addressed the exception that allows liability to be
extended to a hirer when the contracted work poses a "peculiar risk" of injury to others.
The peculiar risk exception evolved as a way "to ensure that innocent third parties injured
by the negligence of an independent contractor hired by a landowner to do inherently
dangerous work on the land would not have to depend on the contractor's solvency in
order to receive compensation for the injuries. [Citations.]" (Privette, supra, 5 Cal.4th at
p. 694.) California was one of the minority of jurisdictions that expanded this doctrine
beyond third parties and allowed the contractor's employees to seek recovery from the
hirer for injuries caused by the contractor's negligence. (Id. at p. 696 [discussing Woolen
v. Aerojet General Corp. (1962) 57 Cal.2d 407].) However, the Privette court
determined this extension of peculiar risk liability to hirers did not "withstand scrutiny"
when considered in light of the workers' compensation scheme. (Privette, supra, at

2
As other courts have noted, "the person employing the independent contractor may be
referred to as the `employer,' `principal,' `hirer' or, depending on the circumstances of the case,
as the `owner,' `developer' or `general contractor.' " (Toland v. Sunland Housing Group, Inc.
(1998) 18 Cal.4th 253, 271 (conc. & dis. opn. of Werdegar, J.) (Toland).) In this opinion, we use
"hirer" as a general term to denote the person who hires an independent contractor. When
discussing the specific context of premises liability, we shall refer to the hirer as the "premises
owner," "property owner" or "landowner."

4

pp. 701-702.) Whereas an innocent bystander might have no other source of
compensation for injuries resulting from a contractor's negligence, the workers'
compensation system guarantees the contractor's employee a recovery for workplace
injuries, regardless of the solvency of the contractor. (Id. at p. 701; Toland, supra, 18
Cal.4th at p. 261.) And, while extension of liability to the hirer is generally justified by
the hirer's right to equitable indemnity from the contractor, such indemnity is not
available for compensation paid to a contractor's employees. "[T]he exclusivity
provisions of the workers' compensation scheme shield the negligent contractor from an
action seeking equitable indemnity. ([Lab. Code,] � 3864.)" (Privette, supra, at p. 701.)
Privette concluded: "When, as here, the injuries resulting from an independent
contractor's performance of inherently dangerous work are to an employee of the
contractor, and thus subject to workers' compensation coverage, the doctrine of peculiar
risk affords no basis for the employee to seek recovery of tort damages from the person
who hired the contractor but did not cause the injuries." (Id. at p. 702.)
In
Toland, supra, 18 Cal.4th 253, the court reaffirmed Privette and explained the
scope of its holding. Insofar as it is relevant here, the doctrine of peculiar risk is
described in sections 413 and 416 of the Restatement Second of Torts (hereafter
Restatement).3 Under section 413, one who hires a contractor to do inherently dangerous
work but fails to require "in the contract" or "in some other manner" that the contractor
take special precautions can be held liable if the contractor's negligence causes injuries to
others. "Because section 413 rests the liability of the hiring person on his or her omission
to provide for special precautions in the contract or in some other manner, it is sometimes
described as a rule of `direct liability.' [Citations.]" (Id. at p. 259.) Under section 416, a
hirer who has provided for special precautions may nevertheless be held liable when the
contractor's failure to take such precautions causes injury to others. "Because the hiring
person's liability under section 416 . . . flows from the independent contractor's negligent
failure to take special precautions in performing the inherently dangerous work, as

3
All section references are to the Restatement Second of Torts unless otherwise indicated.

5

required by `the contract or otherwise,' the hiring person's liability is often referred to as
`vicarious liability.' [Citations.]" (Id. at p. 260.)

The court in Toland rejected the plaintiff's attempt to limit the Privette holding to
claims of "vicarious," versus "direct," liability: "[U]nder both sections 413 and 416, the
hiring person's liability is cast in the form of the hiring person's breach of a duty to see to
it that special precautions are taken to prevent injuries to others; in that sense, the liability
is `direct.' Yet, peculiar risk liability is not a traditional theory of direct liability for the
risks created by one's own conduct: Liability under both sections is in essence
`vicarious' or `derivative' in the sense that it derives from the `act or omission' of the
hired contractor, because it is the hired contractor who has caused the injury by failing to
use reasonable care in performing the work." (Toland, supra, 18 Cal.4th at p. 265.)
Instead, the court returned to the policy rationale underlying Privette and concluded it
applied equally whether the hirer's liability was premised on section 413 or 416: "As we
concluded in Privette, supra, 5 Cal.4th 689, it is illogical and unfair that a landowner or
other person who hires an independent contractor should have greater liability for the
independent contractor's negligence towards the contractor's employees than the
independent contractor whose liability is limited to providing workers' compensation
coverage. Imposing on the hiring person a liability greater than that incurred by the
independent contractor (the party with the greatest and most direct fault) is equally unfair
and illogical whether the hiring person's liability is premised on the theory of section 413
. . . or the theory of section 416 . . . ." (Toland, supra, at p. 270.)
In
Camargo v. Tjaarda Dairy (2001) 25 Cal.4th 1235 (Camargo), the high court
extended the Privette rationale to the tort of negligent hiring. (� 411 [subjecting hirer of
contractor to liability for injuries suffered by "third persons" due to contractor's
negligence].) Once again, the court stressed the irrelevance of a distinction between
"direct" versus "vicarious" liability in these cases, stating, "the rationale of our decision
in Privette extends to cases where the hirer is directly negligent in the sense of having
failed to take precautions against the peculiar risks involved in the work entrusted to the
contractor." (Camargo, supra, at p. 1243.) Although a party sued for negligent hiring

6

"is, in a sense, being taxed with his own negligence under a theory of direct liability" (id.
at p. 1244), under section 411 "the liability of the hirer is `in essence "vicarious" or
"derivative" in the sense that it derives from the "act or omission" of the hired contractor,
because it is the hired contractor who caused the injury by failing to use reasonable care
in performing the work.' (Toland, supra, 18 Cal.4th at p. 265.)" (Camargo, supra, at
p. 1244.) Thus, the court concluded, it would be just as unfair to impose liability on the
hiring party in a negligent hiring case as in a peculiar risk case. (Ibid.)

In the recent case Hooker v. Department of Transportation (2002) 27 Cal.4th 198
(Hooker), the Supreme Court considered whether an independent contractor's employee
may sue the hirer for negligent exercise of retained control, as that tort is described in
section 414 of the Restatement. The court emphasized again, "the conclusion that a
hirer's liability can be characterized as direct does not end the inquiry into whether the
hirer should be held liable for injuries to a contractor's employees . . . ." (Hooker, supra,
at p. 210.) Instead, the court returned to the fairness principles underlying Privette to cast
a rule of limited liability: "[B]ecause the liability of the contractor, the person primarily
responsible for the worker's on-the-job injuries, is limited to providing workers'
compensation coverage, it would be unfair to impose tort liability on the hirer of the
contractor merely because the hirer retained the ability to exercise control over safety at
the worksite. In fairness, . . . the imposition of tort liability on a hirer should depend on
whether the hirer exercised the control that was retained in a manner that affirmatively
contributed to the injury of the contractor's employee." (Id. at p. 210.) The requirement
of an affirmative contribution makes imposing liability on the hirer consistent with
Privette and its progeny, the court reasoned, "because the liability of the hirer in such a
case is not ` "in essence `vicarious' or `derivative' in the sense that it derives from the
`act or omission' of the hired contractor." ' [Citations.] To the contrary, the liability of
the hirer in such a case is direct in a much stronger sense of that term." (Id. at p. 212.)
Finally,
in
McKown v. Wal-Mart Stores, Inc. (2002) 27 Cal.4th 219 (McKown), the
Supreme Court extended the holding of Hooker to the tort of negligent provision of
unsafe equipment. When a hirer negligently furnishes unsafe equipment to the

7

contractor, and in doing so affirmatively contributes to injuries suffered by the
contractor's employee, the court held the hirer may be held liable "for the consequences
of [its] own negligence." (Id. at p. 225.)

Thus, the Supreme Court has adhered to the policies outlined in Privette that limit
a hirer's vicarious or derivative liability to a contractor's employee; however, the court
has also made it clear that these policies are not violated when a hirer is held liable to
such an employee based on the hirer's own affirmative negligence.
B.
Application
of
Privette Rationale to Premises Liability

The jury in this case held Unocal, a premises owner, liable to an independent
contractor's employee for negligent maintenance of its property. This claim derives from
section 343 of the Restatement, which states: "A possessor of land is subject to liability
for physical harm caused to his invitees by a condition on the land if, but only if, he
[�] (a) knows or by the exercise of reasonable care would discover the condition, and
should realize that it involves an unreasonable risk of harm to such invitees, and [�] (b)
should expect that they will not discover or realize the danger, or will fail to protect
themselves against it, and [�] (c) fails to exercise reasonable care to protect them against
the danger." Thus, a landowner owes a duty to invitees to exercise reasonable care in
maintaining the premises. (� 343; see also Rowland v. Christian (1968) 69 Cal.2d 108,
119.) It has long been held that an employee of a subcontractor is an invitee for purposes
of liability under section 343. (See Gettemy v. Star House Movers (1964) 225
Cal.App.2d 636, 644-645.)
Kinsman
contends
Privette is irrelevant because, under section 343, a landowner's
liability is "direct" and not "vicarious."4 He argues the Privette doctrine only bars claims

4
Section 343 does not appear in chapter 15 of the Restatement, and thus it is not an
express exception to the general rule of nonliability to a contractor's employees. (See � 409
["Except as stated in �� 410-429, the employer of an independent contractor is not liable for
physical harm caused to another by an act or omission of the contractor or his servants"].)
However, section 343 operates as such an exception if used to impose liability on a landowner
when a contractor's employee suffers injury due to a dangerous condition that was created by the
independent contractor.

8

that a landowner is " `vicariously' liable for the primary negligence of an independent
contractor." However, as noted above, the Supreme Court has repeatedly rejected this pat
distinction between "direct" and "vicarious" liability. (Toland, supra, 18 Cal.4th at
p. 265; Camargo, supra, 25 Cal.4th at p. 1243; Hooker, supra, 27 Cal.4th at p. 210.) The
issue is more complex. When an independent contractor's employee sues a hirer or
landowner for injuries sustained on the job, Supreme Court decisions have examined
whether the defendant's liability is truly independent, or whether it actually "derives from
the `act or omission' of the hired contractor, . . . who has caused the injury by failing to
use reasonable care in performing the work." (Toland, supra, at p. 265; see also
Camargo, supra, at p. 1244; Hooker, supra, at p. 212.)5

Some tort theories, such as the "peculiar risk" doctrine and negligent hiring,
extend liability to a landowner or hirer even though the acts or omissions causing the
employee's injury are entirely those of the hired contractor. Considerations of fairness
and the availability of worker's compensation relief led the Supreme Court to conclude a
landowner or hirer bears no liability to injured employees of independent contractors
under these theories. (Privette, supra, 5 Cal.4th at p. 702; Toland, supra, 18 Cal.4th at
p. 270; Camargo, supra, 25 Cal.4th at p. 1244.) Under other tort theories, however, a
landowner may be held liable if the employee's injury results from the negligence of the
hired contractor or if the landowner's own acts or omissions contribute to the injury. The
primary example of such a tort is the negligent exercise of retained control (� 414). A

5
Thus, when a landowner violates a separate duty of care owed to the plaintiff, and
thereby contributes to the plaintiff's injury, the landowner may be held liable despite the Privette
rule. (Ray v. Silverado Constructors (2002) 98 Cal.App.4th 1120 (Ray).) In Ray, the plaintiff's
decedent was killed when high winds blew heavy construction materials off a bridge and onto
the roadway below, and a heavy object struck him in the head. The Fourth District Court of
Appeal, Division Three reversed an entry of summary judgment in favor of the project's owner
and general contractor because triable issues of fact remained regarding whether these entities
had an independent duty (pursuant to contract, case law and regulations) to close the roadway.
(Id. at pp. 1128-1129.) The court observed the Privette doctrine does not bar all "direct" liability
actions against owners and general contractors, and since the plaintiff asserted such a "direct"
claim--which did not derive from negligence of the subcontractor--it was not precluded as a
matter of law. (Id. at p. 1129.)

9

hirer can be held liable if it failed to exercise retained control over a contractor and the
plaintiff was injured due to the contractor's negligence. Or, a hirer may be held liable if,
in exercising control over the contractor's work, the hirer's negligent act or omission
caused or contributed to the plaintiff's injury. In light of the fairness principles expressed
in Privette, the hirer bears liability to an independent contractor's employee only in the
second scenario--i.e., when the hirer's own exercise of control affirmatively contributes
to injuries suffered by the employee. (Hooker, supra, 27 Cal.4th at p. 210; see also
Kinney v. CSB Construction, Inc. (2001) 87 Cal.App.4th 28, 36 [no liability under section
414 where hirer fails to exercise a general supervisory power and there is no evidence
hirer's conduct contributed to the contractor's negligence]; Zamudio v. City and County
of San Francisco (1999) 70 Cal.App.4th 445, 452-453 (Zamudio) [no liability under
section 414 absent hirer's direct management of the contractor's work and absent an
affirmative act by hirer contributing to the employee's injury].)

Consistent with the Supreme Court's reasoning in Hooker and McKown, we
conclude a premises owner's liability for injuries suffered by an independent contractor's
employee due to a dangerous condition on the land created by the contractor is limited by
the Privette doctrine to only those cases in which the owner has control over the
dangerous condition and acts, or fails to act, in a manner that affirmatively contributes to
the employee's injury. A premises owner's liability under section 343 is like that under
section 414 (retained control): It may arise if the plaintiff is injured by a dangerous
condition the landowner created, or knowingly failed to remedy; or, it may arise if the
plaintiff is injured by a dangerous condition created entirely by third parties, or the
plaintiff himself, and beyond the landowner's power to control. In this second context,
the Privette doctrine permits recovery by a contractor's employee only when the
landowner has actively or affirmatively contributed to the employee's injury from the
dangerous condition.6

6
The recent decision in Ray v. Silverado Constructors (see ante, fn. 5) does not compel a
different result. Ray simply held the Privette doctrine does not provide an absolute defense for a

10

Two appellate decisions issued before Hooker and McKown considered the
application of Privette to a landowner's liability for a dangerous condition on the
property. Both appear to be consistent with our conclusion that a contractor's employee
cannot recover under this theory unless the landowner had control over the dangerous
condition and affirmatively contributed to the employee's injury.7
In
Zamudio, supra, 70 Cal.App.4th 445, 447, a subcontractor's employee was
injured when he fell through a plank at a construction site. He sued the site owner, the
City and County of San Francisco (CCSF), on numerous theories including the
maintenance of a dangerous condition on public land. (Gov. Code, � 830 et seq.)
However, the Zamudio court noted the only "dangerous condition" was a plank that was
owned, and placed in a potentially dangerous position, by the plaintiff's employer.
(Zamudio, supra, at pp. 454-455.) The danger was created entirely by the contractor's
work and did not arise from the property itself. (Id. at p. 455.) Under these
circumstances, the court concluded: "As long as CCSF did not act affirmatively to create
or increase the risk of injury or did not retain control over the specific injury-causing
activities of the injured worker's employer, Privette and Toland bar recovery.
[Citation.]" (Ibid.)

property owner who allegedly violated an independent duty owed to the plaintiff. (Ray, supra,
98 Cal.App.4th at p. 1130.)
7
Our decision is also consistent with limitations other states have imposed on premises
owners' liability to employees of independent contractors. (See, e.g., Lee v. E. I. Dupont De
Nemours & Co (5th Cir. 2001) 249 F.3d 362, 364-365 [under Mississippi law, an owner is not
liable to contractor's employees under premises liability theory unless the owner retained a
substantial right of control over the contractor's work and the employee's injuries arose from or
were connected to the work]; West v. Briggs & Stratton Corp. (2000) 244 Ga.App. 840, 844-845
[536 S.E.2d 828, 832] [owner has no duty to maintain safe premises for independent contractor's
employees if owner has relinquished possession of premises, in whole or in part, and owner does
not control or direct the work being done]; Dow Chemical Co. v. Bright (Tex. 2002) 89 S.W.3d
602, 606 [where dangerous condition is created by an independent contractor's work activity,
owner owes no duty to contractor's employees unless owner exercises control over the
contractor's work].)

11

The facts in an earlier case, Grahn v. Tosco Corp. (1997) 58 Cal.App.4th 1373
(Grahn), are very similar to those in the case before us. Grahn was exposed to asbestos
when he worked for an independent contractor, J. L. Thorpe & Sons (Thorpe), at various
jobsites, installing and removing insulation materials. (Id. at pp. 1379-1380.) He was
later diagnosed with asbestos-related lung disease. Grahn sued approximately 200
defendants, including the owners of several properties where he had worked. Grahn
alleged that during such work, he was exposed to asbestos. (Id. at p. 1380.) The case
proceeded to trial against one such premises owner, Tosco Corporation (Tosco), on three
theories: (1) Tosco was negligent in hiring Thorpe; (2) Tosco negligently failed to
exercise the control it retained over Thorpe's work; and (3) "Tosco was negligent in the
use and maintenance of its premises thereby exposing others to an unreasonable risk of
harm." (Ibid.) We approach Grahn with some trepidation, since the Supreme Court has
expressly disapproved of the holdings this case announced regarding a landowner's
liability for negligent hiring (Camargo, supra, 25 Cal.4th at pp. 1243-1245) and negligent
exercise of retained control (Hooker, supra, 27 Cal.4th at pp. 209-210, 214). However,
the observations in Grahn about general premises liability remain good law.
In
Grahn, as in the case before us, the premises owner challenged a generic jury
instruction describing a landowner's duty to maintain the premises in a safe condition.
Tosco argued the instruction was "prejudicially misleading" because, contrary to
California law on premises liability and the principles expressed in Privette, the
instruction failed to distinguish between unsafe conditions created by the contractor
during the course of the work, or sought to be remedied as part of the contractor's work,
and unsafe conditions "inhering in the premises where the work is to be done. . . ."
(Grahn, supra, 58 Cal.App.4th at p. 1397.) After reviewing several pre-Privette cases,
the court observed that employees of independent contractors have only been allowed to
recover from property owners under the dangerous condition theory if the conditions
were "entirely extraneous to the performance of their work and indisputably within the
control of the premises owner/hirer." (Id. at p. 1400.) Grahn therefore summarized the
duty of a premises owner as follows: "Where the operative details of the work are not

12

under the control of the hirer and the dangerous condition causing injury is either created
by the independent contractor or is, at least in part, the object of the work of the
independent contractor, the duty to protect the independent contractor's employees from
hazards resides with the independent contractor and not the hirer who may also generally
control the premises. In such cases, the hirer is entitled to assume that the independent
contractor will perform its responsibilities in a safe manner, taking proper care and
precautions to assure the safety of its employees. [Citation.]" (Id. at p. 1398.)
Furthermore,
Grahn observed that imposing liability on a premises owner for
dangerous conditions that were created by the independent contractor, or "the very
subject of the work to be performed" by the contractor, "is tantamount to assigning
vicarious liability" to the premises owner--and thus clearly runs afoul of Privette.
(Grahn, supra, 58 Cal.App.4th at pp. 1400-1401.) Based on California premises law and
Privette, Grahn announced a rule limiting the liability of premises owners in this context:
"[I]n the absence of the hirer's retention of control of the methods or operative details of
the independent contractor's work, the hirer cannot be held liable to the independent
contractor's employee as a result of the dangerous condition on the hirer's property if:
1) a preexisting dangerous condition was known or reasonably discoverable by the
contractor, and the condition is the subject of at least a part of the work contemplated by
the independent contractor; or 2) the contractor creates the dangerous condition on the
hirer's property and the hirer does not increase the risk of harm by its own affirmative
conduct." (Id. at p. 1401.)

Grahn's formulation has drawn some criticism. (See Wise, The Marine Terminal
and Its Contracts: Avoiding and Shifting the Risks of Marine Terminal Operations (2001)
13 U.S.F. Maritime L.J. 227, 248 [stating Grahn's second prong "is inconsistent with
Privette, Toland and Camargo because it focuses on the condition of the property created
by the contractor, not the hirer's conduct"].) We announce a simpler rule that appears to
be more in line with recent Supreme Court holdings, and the liability limitation expressed
by Division Five of this court in Zamudio: A property owner cannot be liable to a
contractor's employee for a dangerous condition a contractor has created on the land

13

unless the owner exercised control over the condition and, in doing so, affirmatively
contributed to the employee's injury. (See Zamudio, supra, 70 Cal.App.4th at p. 455; cf.
Hooker, supra, 27 Cal.4th at p. 210.) If the owner did not have control over the
condition, or did not exercise the control in a manner that affirmatively contributed to the
plaintiff's injury, any liability imposed on the owner would be essentially "vicarious" or
"derivative" of the primary negligence of the contractor. (See Toland, supra, 18 Cal.4th
at p. 265.) This is impermissible under Privette and Toland. Unlike the rule announced
in Grahn, under our formulation a premises owner's liability to employees of
independent contractors depends upon the knowledge and acts of the owner. The rule we
announce also avoids Grahn's error in permitting liability against premises owners who
did not exercise control over the work giving rise to a dangerous condition. (See Hooker,
supra, at p. 210, 214 [disapproving Grahn's holding that a hirer may be liable even
though it did not exercise control it had retained].)
III. Instructional
Error

Accepting that the Privette doctrine may require some limitation on a landowner's
liability to employees of independent contractors, Kinsman argues Unocal's liability
should not be limited in his case because: (1) the dangerous condition was created by
neighboring contractors, not Kinsman's employer; (2) the jury did not find any party
other than Unocal "negligent"; and (3) Unocal did not prove Kinsman's employer carried
worker's compensation insurance.8

8
Kinsman also asserted for the first time at oral argument that Unocal should be held liable
because it retained control over air quality management in the refinery. However, this factual
question was never presented to the jury, and it cannot be fairly inferred from the jury's
negligence verdict. If, on retrial, a properly instructed jury concludes Unocal did retain control
over air quality at the Wilmington refinery, and did affirmatively contribute to Kinsman's
exposure to asbestos dust, these factual findings would support the imposition of liability on
Unocal under the rule we have articulated.

14

A.
Dangerous Condition Created by Neighboring Contractors
In
Grahn, the court concluded a jury instruction was misleading because it
allowed the jury to assign a premises owner vicarious liability for a dangerous condition
created and controlled by the contractor. (Grahn, supra, 58 Cal.App.4th at pp. 1400-
1401.) The jury in the asbestos case now before us received an almost identical
instruction, which is based on BAJI 8.01. It states, in relevant part: "The owner or
occupant of premises is under a duty to exercise ordinary care in the use, maintenance
and management of the premises in order to avoid exposing persons to an unreasonable
risk of harm. This duty exists whether the risk of harm is caused by the natural condition
of the premises or by an artificial condition created on the premises. This duty is owed to
persons on the premises and to persons off the premises. A failure to fulfill this duty is
negligence. [�] You shall determine whether a person under the same or similar
circumstances as defendant UNOCAL should have foreseen that a person such as
plaintiff RAY KINSMAN would be exposed to an unreasonable risk of harm. If you so
find, you are instructed that the defendant UNOCAL owed plaintiff RAY KINSMAN a
duty of care and you should determine if the defendant exercised that care, considering
all the surrounding circumstances shown by the evidence." (Compare Grahn, supra, at
p. 1397.)

The parties argued at length below whether Grahn required a modification of this
generic duty instruction, or separate special instructions, to advise the jury of the limited
duty a premises owner owes to the employee of an independent contractor. Kinsman
claimed no such modification or additional instructions were appropriate because
Grahn's holding is limited to situations in which the plaintiff's injury results "solely"
from work he performed for his employer. Although Kinsman was exposed to some
asbestos when he "tied in" scaffolding to insulated pipes and equipment, the evidence
suggested most of his exposure resulted from the work of neighboring insulators, who left
asbestos-containing debris on Kinsman's scaffolding and whose work released asbestos
into the air in the area of the refinery where Kinsman worked. Because the dangerous
condition (i.e., airborne asbestos) was not created by Kinsman or his employer, but

15

primarily resulted from the activities of other contractors on-site, Kinsman argued he was
akin to an injured bystander to whom Unocal owed a full duty of care notwithstanding
Grahn or the Privette line of cases. The trial court agreed and gave the BAJI 8.0 series of
instructions on premises liability without modification.

Kinsman's argument reads a limitation into the Privette doctrine that is
unsupported by case law and inconsistent with the policies the doctrine serves.
According to Kinsman, a contractor's employee is precluded from obtaining recovery
from a premises owner for injuries he sustains on the property only if he was injured by a
dangerous condition his own employer created in doing the contracted-for work. And, if
the danger was created by other contractors working nearby, the premises owner can be
held liable regardless of whether it actually had control over the other contractors'
activities. Kinsman's position illustrates the aspect of Grahn that is inconsistent with
Privette--namely, its focus on the activities of the contractor rather than the owner.
Considering the fairness rationale underlying the Privette line of cases, it should not
matter whether a dangerous condition was created by the plaintiff's employer or another
contractor. If the hazard was not created by the property owner, or within the owner's
control, the owner should not bear liability for an injury that is compensable under the
worker's compensation system.
Consistent
with
Privette and cases following it, we conclude a contractor's
employee such as Kinsman may not recover under section 343 from a landowner such as
Unocal absent proof Unocal had control over the allegedly dangerous condition on its
property and affirmatively contributed to the injury. Whether the dangerous condition
was created primarily by Kinsman's employer or another contractor is irrelevant in this
analysis; the appropriate focus is on Unocal's relation to the condition.

We find support for this conclusion in Smith v. ACandS, Inc. (1994) 31
Cal.App.4th 77, disapproved on another ground in Camargo, supra, 25 Cal.4th at p. 1245
(Smith). The plaintiff in Smith developed asbestosis and asbestos-related pleural disease
after he worked as a pipefitter at many jobsites, including two power plants built by
Pacific Gas and Electric Company (PG&E). (Id. at p. 82.) Much of Smith's asbestos

16

exposure resulted from his work in proximity to other trades, especially insulators. (Id. at
pp. 84-85.) Smith proceeded to trial on his personal injury claims, and the jury found
PG&E negligent and negligent per se and "held [PG&E] vicariously liable for hiring
asbestos insulation contractors whose work created a peculiar risk of harm to others."
(Id. at p. 82.) Having determined that the Supreme Court's decision in Privette applied
retroactively to the case, the Smith court considered whether Privette bars liability under
the peculiar risk doctrine when the allegedly negligent party was not the plaintiff's
employer, but a different contractor (or several different contractors). (Id. at p. 95.) The
court concluded it did: "Privette marks a return to the `original form' of the doctrine of
peculiar risk: a landowner is liable to innocent bystanders and neighboring property
owners injured by a hired contractor's negligent performance of dangerous work on the
land. [Citation.] A hired contractor's employee is not a bystander, whether judged in
relation to his own work or in relation to another contractor's activities on a joint
project." (Id. at pp. 95-96, italics added.)9

We recognize that all the policy arguments discussed in Privette do not apply with
equal force when an employee's injury is caused by acts of a neighboring contractor,
rather than his own employer. Such a situation does not present the striking unfairness
that results when the hirer of a contractor bears a full burden of liability but the liability
of the party who is primarily responsible for causing the injury (the plaintiff's employer)
is limited to providing worker's compensation. In Privette, the Supreme Court discussed
this fairness concern and further observed that the exclusivity provisions of the worker's
compensation statutes prohibit the hirer from obtaining indemnification from the
plaintiff's employer, even though the employer was responsible for causing the injury.
(Privette, supra, 5 Cal.4th at p. 701.) Where a worker's injury is caused by a neighboring

9
At oral argument, Kinsman attempted to distinguish Smith on the ground that there was a
finding of negligence (and strict liability) against the insulation contractor in Smith, whereas the
jury made no such finding here. For reasons discussed in section III. B., infra, we do not believe
this distinction is relevant. Nor does it appear the Smith court considered the insulation
contractor's fault to be relevant, since the court reversed the jury's verdicts against this
contractor due to insufficient evidence. (Smith, supra, 31 Cal.App.4th at pp. 82, 87-89.)

17

contractor and not his employer, the worker's compensation statutes do not prevent the
premises owner from seeking equitable indemnity from the contractor responsible for
creating the hazard.

However, we believe it is equally unfair to impose liability on the hirer when a
contractor's employee is injured from a dangerous condition created by his own employer
or by a neighboring contractor notwithstanding the availability of equitable indemnity. In
addition, limiting a hirer's liability for injuries caused by neighboring contractors is
consistent with other policies discussed in Privette and its progeny. As the Smith court
observed, workers' compensation benefits are available to an employee injured on the job
regardless of whether the injury results from acts of his own employer or of another
contractor. (Smith, supra, 31 Cal.App.4th at p. 96.) Landowners who hire contractors
indirectly pay the cost of workers' compensation coverage; therefore, imposing liability
on landowners for injuries caused by any of the contractors they employ "would unfairly
subject them to multiple costs for a single injury for which they are not personally at
fault. (Privette[,] supra, 5 Cal.4th at p. 699.)" (Smith, supra, at p. 96; see also Camargo,
supra, 25 Cal.4th at pp. 1244-1245 [hirer who has indirectly paid the cost of worker's
compensation coverage should also enjoy the benefit of exclusivity provisions].) And, as
is the case when a plaintiff's own employer causes the injury, permitting recovery from a
landowner for injuries caused by other contractors "would give contractors' employees
`an unwarranted windfall' by exempting `a single class of employees, those who work for
independent contractors, from the statutorily mandated limits of workers'
compensation. . . .' ([Privette, supra,] at p. 700, citations omitted.)" (Smith, supra, at
p. 96; see also Camargo, supra, at p. 1245.)

B.
Dangerous Condition Not Negligently Created by Contractor

Kinsman also seeks to distinguish Grahn and Smith because Unocal did not prove
the insulation work at its refinery was performed by independent contractors, as opposed
to Unocal's own employees. He also argues there was no evidence that the insulators --
or, indeed, any of the other contractors -- were negligent. However, these arguments

18

directly contradict positions Kinsman took at trial. The evidence did not establish, and
apparently the parties did not know, what company employed the insulators who worked
at the Unocal refinery nearly 50 years ago. Yet, until shortly before the case was
submitted to the jury, Kinsman pursued a claim against Unocal for negligent hiring based
on the theory Unocal hired insulation contractors who negligently exposed him to
asbestos.10 Kinsman offered no evidence below to suggest the insulators were not
employed by independent contractors, and the jury could reasonably have found, as
Kinsman's own counsel apparently assumed, that the insulators worked for independent
contractors just as Kinsman himself did. Similarly, Kinsman's assertion that special
instructions were unnecessary because Unocal was "the only entity shown to be
negligent" ignores evidence suggesting the insulators acted carelessly in releasing
asbestos dust and evidence showing Kinsman's employer, Burke & Reynolds, failed to
discuss the dangers of asbestos in safety meetings and failed to require its employees to
wear masks. Moreover, Kinsman's insistence that Unocal was the only negligent party is
belied by the jury verdict, which assigned only 15 percent of the fault to Unocal and 85
percent to unnamed "all others."

Nevertheless, setting aside these factual problems and accepting Kinsman's
premise, his argument presents this question of law: Do the limitations on liability
established in Privette and its progeny apply when the dangerous condition that injured a
contractor's employee was not created by the contractor's negligence? We conclude the
limitations apply.

10
The court questioned Kinsman's counsel about this negligent hiring theory during at least
two jury instruction conferences: "[The Court]: Negligent hiring of -- [Mr. Kelly]: The
insulators, Your Honor. [�] That were doing their job in such a way to create a health hazard to
those who were below it . . . . [The Court]: What would be the evidence you would have on the
negligent hiring theory? [Mr. Kelly]: Evidence would be, it is a res ipsa-type theory. The fact
they did their job in such a way to cause exposure to my client is negligent in and of itself." In
another conference, the court asked, "On negligent hiring, what's your theory?" Kinsman's
counsel responded, "That Unocal hired insulators who may or may not have been competent to
insulate, but they were not competent in protecting workers exposed to the hazardous materials

19

Although some Supreme Court cases frame the issue as one concerning a hirer's
liability for injuries caused by a contractor's negligent performance of its work (see, e.g.,
Privette, supra, 5 Cal.4th at p. 691; Toland, supra, 18 Cal.4th at p. 256), none of the
cases discusses, let alone requires, findings of negligence by the independent contractor.
This is not surprising since, in such cases, the plaintiff has recovered worker's
compensation and is precluded from suing his employer for negligence. Moreover, in the
peculiar risk cases, the Supreme Court was addressing theories of hirer liability premised
entirely on the contractor's failure to exercise reasonable care in performing inherently
dangerous work. In most cases, it is fair to equate a hired contractor's " `act or omission'
. . . caus[ing] the injury" with a "fail[ure] to use reasonable care in performing the work"
(Toland, supra, 18 Cal.4th at p. 265) because the dangerous condition that led to the
employee's injury is fairly obvious. Thus, the dangerous condition is capable of being
foreseen and prevented by the contractor. But this inference is not necessarily valid in
the context of hidden or latent dangerous conditions. If a danger is hidden or unknown
(such as the danger posed by airborne asbestos dust was arguably unknown to some in
the 1950s), an unwitting contractor could conceivably create a dangerous condition that
injures workers without having performed its job negligently. Assuming the contractor
could not have foreseen the risk created by its work, the contractor was not "negligent" in
performing the work.

When an unknown or hidden danger is created by the work being done by the
contractor, we do not think proof of the contractor's "negligence" is a necessary
prerequisite to application of the principles expressed in Privette and the cases following
it. None of the Supreme Court's decisions premise a hirer's limited liability on a finding
of negligence by the independent contractor. Indeed, the court's recent decision in
Hooker does not mention negligence by the contractor at all. In Hooker, the employee-
plaintiff left his crane in an unsafe configuration, and he was killed when he returned to

which their insulators used. [�] In other words, the insulators didn't take care not to expose other
people who didn't work for the insulators, such as Mr. Kinsman."

20

the crane and attempted to operate it without correcting the position. (Hooker, supra, 27
Cal.4th at p. 202.) The facts recited by the court clearly show the hirer, Caltrans, retained
control over safety conditions at the jobsite, yet there is no suggestion that the plaintiff's
employer was negligent with regard to the accident. (Id. at pp. 202-203, 214.) The
hirer's retained control of the jobsite was the plaintiff's sole theory of negligence.
Furthermore,
grafting
onto
Privette a requirement that the hired contractor was
negligent would be inconsistent with the policies underlying the doctrine. The
"compelling consideration" that led the Supreme Court to abolish peculiar risk liability in
Privette and Toland was the ability of injured employees to obtain worker's
compensation. (Smith, supra, 31 Cal.App.4th at p. 96.) Because the contractor's
employee is assured a recovery under the worker's compensation statutes, and because
the hirer has indirectly paid the cost of worker's compensation coverage in the contract
price, the court has reasoned the hirer should not face further liability when it did not
affirmatively contribute to causing the employee's injury. (See, e.g., Hooker, supra, 27
Cal.4th at pp. 210, 213; Camargo, supra, 25 Cal.4th at pp. 1244-1245; Privette, supra, 5
Cal.4th at pp. 696, 699.) These principles apply with the same force when the plaintiff's
employer was not negligent. The worker's compensation system guarantees employees a
recovery for workplace injuries regardless of fault. (Privette, supra, at p. 697.)
Therefore, a contractor's employee can be compensated for a workplace injury regardless
of whether his employer's negligence caused the injury. It would be illogical to require a
hirer to prove negligence by the independent contractor when no such showing is
required by the injured employee. Moreover, conditioning recovery from hirers or
premises owners on a showing of negligence by the hired contractor would unfairly
benefit some employees but not others.

C.
Proof of Worker's Compensation Coverage

Finally, Kinsman contends Unocal could not take advantage of the Privette rule
because Unocal did not prove Burke & Reynolds carried workers' compensation
insurance. Kinsman posits such proof of coverage as a condition precedent that premises

21

owners must satisfy before they may reap the benefits of limited liability under Privette.
Not surprisingly, Kinsman cites no authority for this position. Indeed, the Supreme Court
suggested otherwise when it observed that an employee of an uninsured contractor can
obtain workers' compensation benefits for a workplace injury under Labor Code
section 3716. (See Toland, supra, 18 Cal.4th at p. 261.) The Workers' Compensation
Act entitles all employees to recover benefits for workplace injuries, including those
whose employers do not carry workers' compensation insurance. (Lab. Code, � 3716
[establishing uninsured employers fund]; Privette, supra, 5 Cal.4th at pp. 696-697.)
Because the workers' compensation scheme guarantees a recovery to a contractor's
employee who is injured on the job, regardless of whether his employer is insured, we see
no reason to graft a "proof of insurance" requirement onto the Privette doctrine.
Although Kinsman may be correct in observing that an employee can pursue an
uninsured employer for an additional civil recovery (see Lab. Code, � 3715, subd. (a)),
this fact does not alter the unfairness of imposing liability on a landowner for the
contractor's negligent acts. Even if his employer lacks insurance, a contractor's
employee has a guaranteed source of recovery for workplace injury; simply because the
law allows the employee to seek an additional recovery from his employer under some
circumstances does not justify expanding liability to the landowner for the contractor's
failure to insure.
IV. Prejudice

Though not phrased as such, many of Kinsman's arguments distinguishing
Privette boil down to a claim that the trial court's reading of BAJI 8.01 was not
prejudicial given the evidence in the case. However, our standard of review on this
question favors the appellant, not the respondent. On an appeal from an allegedly
erroneous jury instruction, we must view the evidence in the light most favorable to the
appellant's claim of instructional error, and we must reverse if it appears the jury,
properly instructed, might have decided in the appellant's favor. (Henderson v.

22

Harnischfeger Corp. (1974) 12 Cal.3d 663, 674; GAB Business Services, Inc. v. Lindsey
& Newsom Claim Services, Inc. (2000) 83 Cal.App.4th 409, 423.)

We conclude the trial court's failure to instruct the jury on Unocal's limited duty
to Kinsman likely affected the verdict and constituted prejudicial error. (See Soule v.
General Motors Corp. (1994) 8 Cal.4th 548, 580 ["Instructional error in a civil case is
prejudicial `where it seems probable' that the error `prejudicially affected the
verdict.' [Citations.]"].) Kinsman's theory of negligence consisted of evidence showing
Unocal knew asbestos was present in areas of the refinery where Kinsman worked,
Unocal had access to information such that it knew or should have known the asbestos in
its refinery was dangerous, and Unocal contracted for work that involved the release of
asbestos fibers into the air without warning Kinsman of the hazard or urging him to wear
a mask. Based on this evidence and the BAJI 8.01 instruction, the jury held Unocal liable
for negligent maintenance of its land. However, the jury also found Unocal did not retain
control over the methods or manner in which Kinsman performed his work. Given this
finding, if the jury had been instructed about the limits on Unocal's liability described in
this opinion, it would likely have concluded Unocal had no liability to Kinsman
whatsoever--because Unocal did not retain control over the dangerous condition (i.e.,
airborne asbestos) present on its land, or because the evidence did not show that Unocal
affirmatively contributed to Kinsman's injury.
DISPOSITION

The judgment is reversed and the matter remanded for a new trial in accord with
this opinion. Each side to bear its own costs on appeal.

_________________________
Parrilli,
J.
We concur:
_________________________
McGuiness, P. J.
_________________________
Corrigan, J.

23

Trial Court:
Superior Court, City and County of San Francisco

Trial Judge:
Hon. Paul H. Alvarado

Counsel for Appellant:
Michael T. McCall, Robert M. Channel, Cyrian B.

Tabuena, Allan W. Ruggles;

WALSWORTH, FRANKLIN, BEVINS &

McCALL

Counsel for Respondent:
Daniel U. Smith, Ted W. Pelletier

Harry F. Wartnick, Charles C. Kelly II;
WARTNICK, CHABER, HAROWITZ &
TIGERMAN

Kinsman et al. v. Unocal Corporation, A093424 and A093649

24