An apartment management company is liable for the workers’ compensation benefits due to a worker who was employed by a contractor of the management company in Kansas.

A three-judge panel of the appellate court upheld a Kansas Workers’ Comp Appeals Board ruling that the company acted as a general contractor and was liable for injuries sustained by workers of a painting contractor that they hired for their building.

Kelly Enterprises Inc. builds and manages apartment complexes and acts as the general contractor for their buildings. Manual Ramirez was a painter for Garay’s Roofing & Painting LLC. Kelly had hired Garay’s to work on a new apartment building they were constructing. Garay’s had a certificate of workers’ comp insurance that they gave to Kelly Enterprises, but when Manual Ramirez was injured in 2015, they were not insured. He fell from a ladder in 2015, hitting his head and breaking his left arm on the concrete below. His medical bills totaled $189,000 and he sent them to Garay, who had requested them, but Mr. Ramirez said once he sent those in the company no longer contacted him and did not take phone calls.

He went to the Kansas Division of Workers’ Comp, and an administrative law judge said his injuries were compensable via the Kansas Workers’ Compensation Fund. The fund appealed and said Kelly was a statutory employer who had secondary liability. The Workers’ Compensation Board agreed, and the appellate court upheld that decision

Kansas statues allow a contractor’s employer to recover workers’ comp benefits from the employee’s immediate employer or the principal, if the work the employee is doing is part of the principal’s trade/business, or if the principal has contracted to do the work for a third party. Since constructing apartment complexes was part of Kelly’s business, they were responsible for workers’ comp benefits. Kelly had argued that Garay assured them they had workers’ comp insurance and argued for a good-faith exception, but the state’s statutes did not provide for that.

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