Full Opinion

Filed Washington State Court of Appeals Division Two November 10, 2026 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION II DHI COMMUNITIES CONSTRUCTION OF No. 61057-4-II WASHINGTON, Appellant, v. ORDER GRANTING MOTION TO WASHINGTON STATE DEPARTMENT OF PUBLISH AND PUBLISHING OPINION LABOR AND INDUSTRIES, Respondent. The unpublished opinion in this matter was filed on October 6, 2026. Respondent, Department of Labor and Industries, filed a motion to publish on October 22, 2026. Appellant, DHI Communities Construction of Washington, filed an answer to the motion to publish on October 28, 2026. After consideration, the court grants the motion. It is hereby ORDERED that the final paragraph of the opinion, which reads “A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040, it is so ordered.” is deleted. It is further ORDERED that this opinion will now be published. PANEL: Jj. CRUSER, MAXA, VELJACIC FOR THE COURT: CRUSER, J. Filed Washington State Court of Appeals Division Two October 6, 2026 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION II DHI COMMUNITIES CONSTRUCTION OF No. 61057-4-II WASHINGTON, Appellant, v. WASHINGTON STATE DEPARTMENT OF UNPUBLISHED OPINION LABOR AND INDUSTRIES, Respondent. CRUSER, J.—DHI Communities Construction of Washington (DHI), a general contractor, appeals a Board of Industrial Insurance Appeals (BIIA) decision and order affirming the Department of Labor and Industries’ (L&I) Citation and Notice No. 317970447. The citation alleged five violations of the Washington Industrial Safety and Health Act of 1973 (WISHA), ch. 49.17 RCW, by DHI’s subcontractor, Northwest Framing. DHI argues (1) the BIIA erred by failing to adopt the federal standard for multi-employer violations, (2) substantial evidence did not support the BIIA’s finding that DHI had actual or constructive knowledge of the lack of fall protection for Northwest Framing’s workers and of Northwest Framing’s failure to develop and implement a written fall protection work plan, (3) substantial evidence did not support the BIIA’s finding that the violations were willful because DHI could not willfully violate a standard that has not been clearly defined, and (4) the BIIA abused its discretion by excluding a CR 30(b)(6) deposition No. 61057-4-II concerning the history and purpose of Division of Occupational Safety and Health (DOSH) Directive 27.00. We conclude (1) the BIIA did not err by applying established and binding Washington precedent rather than adopting the federal test for multi-employer work sites, (2) substantial evidence supported the BIIA’s finding that DHI had constructive knowledge of Northwest Framing’s WISHA violations because the violations occurred in plain view on a day when DHI superintendents were working on the job site, were visible from outside the job trailer, and DHI had already observed several fall safety violations by Northwest Framing employees, (3) substantial evidence supported the BIIA’s finding that the violations were willful because DHI had previously been cited for violating the WISHA fall safety regulations, DHI had previously cited Northwest Framing for fall safety concerns, there were no anchor points, and the violations occurred at multiple houses visible from outside the job trailer on a day when the project managers were working at the site, and (4) DHI has not demonstrated that it was prejudiced by the BIIA’s decision to exclude the deposition from evidence. Accordingly, we affirm. FACTS I. BACKGROUND DHI is the commercial division of DR Horton, a housing construction company. As the commercial division, DHI builds apartments and rental homes. DHI employees do not perform any of the building work themselves, instead they hire and supervise subcontractors. In 2017, DHI began the Rainier Ridge project, a group of 307 apartments and rental casitas in Puyallup, Washington. DHI hired Northwest Framing to frame the apartments and rental casitas for the project. 2 No. 61057-4-II DHI employed superintendents to monitor safety and the progress of its projects. DRH had a written safety program. DHI assigned four superintendents to the Rainier Ridge project. Superintendents held weekly safety meetings with subcontractor employees and conducted daily on-site safety checks. If a superintendent sees a safety violation during a safety check, they employ a sliding scale of disciplinary measures based on the number of occurrences. A superintendent, after seeing a safety violation and correcting the behavior, can (1) issue a verbal warning, (2) issue a written reprimand, or (3) remove the employee or crew from the project. Superintendents would arrive at the trailer in the mornings and discuss the plan for the day. Then they would separate to complete their individual tasks. Typically, the superintendents would be on-site checking on safety and production. According to John Houston, a superintendent for the Rainier Ridge project, “[t]he majority” of a superintendent’s day was spent in the field. Clerk’s Papers (CP) at 2810. Houston estimated that most superintendents on the Rainier Ridge project spent “a little less” than “70/80 percent” of the day in the field. Id. Subcontractors also held their own safety meetings, which DHI kept track of. During the Rainier Ridge project, DHI supervisors wrote up Northwest Framing employees for fall safety concerns on numerous occasions. Houston testified that he raised concerns regarding Northwest Framing’s fall exposure to his supervisors, but he could not remember what the result of his report was. II. L&I INSPECTION In August 2022, Jason Ashlock, a compliance industrial safety and health investigator (CISHI) for the Department of Labor and Industries (L&I), was doing stop-by inspections. While 3 No. 61057-4-II driving in front of the Rainier Ridge project, Ashlock observed personnel working on trusses higher than 10 feet without the required fall protection. Ashlock stopped and took photos. It is undisputed that Northwest Framing employees at three different houses were working on the roof trusses without fall protection. During his inspection, Ashlock observed that the Northwest Framing employees did not have anchors installed anywhere for them to tie off their fall protection system. Ashlock also noticed a worker using a nail gun without the required eye protection. And Ashlock found that DHI did not have the required fall protection work plan in any of the three houses where employees were exposed to a fall hazard of more than 10 feet. WAC 296-880-10020(1). DHI was also unable to produce documentation for 6 out of the prior 12 weeks of formal safety inspections. DHI had one job trailer at Rainier Ridge. The fall safety violations occurred in houses located in the same block as DHI’s job trailer. The west side of the trailer faced the lot where the violations occurred, but there were no windows on the west side of the trailer. Houston was in the job trailer at the time of the inspection. He testified that he could not see any of the lots or houses where the violations occurred from where he was inside the trailer. All three houses where violations were occurring were visible from outside the job trailer. Based on the inspection, L&I issued DHI a citation with five violations. In Violation 1-1(a), [L&I] allege[d] [DHI] violated a former version of WAC 296- 880-30005(1)(c), related to insufficient fall protection; in Violation 1-1(b), that [DHI] violated WAC 296-880-20005(6), again related to insufficient fall protection; in Violation 1-1(c), that [DHI] violated WAC 296-880-10020(1), related to the absence of a fall protection work plan; in Violation 1-2, that [DHI] violated WAC 296-155-350(3), related to lack of personal protective equipment (PPE); and in Violation 2-1, [L&I] alleged that [DHI] violated WAC 296-155- 110(9), related to a lack of a walk-around safety inspection. 4 No. 61057-4-II CP at 122. L&I classified the first four violations as willful and serious Stute violations,1 the fifth as general, and assessed a total of $132,000 in penalties. A Stute violation is a violation that an upper-tiered contractor receives based on their subcontractor’s violations. DHI appealed the citation to the BIIA, arguing that L&I did not properly cite it for the first four violations, that it took all reasonable steps to ensure subcontractor compliance with the cited safety standards, and that L&I did not prove the violations were willful and serious. DHI filed a motion to admit a deposition under CR 30(b)(6). The deposition provided the history and policy basis of DOSH Directive 27.00. The deposition was of Terry Walley, a DOSH compliance operations manager. According to Walley, the directive was formulated to give inspectors guidance on how to implement Stute, 114 Wn.2d at 464, a Washington Supreme Court decision holding that general contractors have the primary responsibility for safety on their worksites. The IAJ held a hearing on the matter. The IAJ ruled that DOSH Directive 27.00 and all questions based upon it were not relevant and were “prejudicial in the sense that it is capable of injecting confusion and waste of time into the case.” CP at 126. Following a hearing, the IAJ issued a proposed decision and order reclassifying the eye protection violation from “willful” to “general” but otherwise affirming the citation. Id. at 122. DHI and L&I filed petitions for review. The BIIA denied the petitions for review and adopted the proposed decision and order. The superior court affirmed. DHI appeals. 1 Stute v. P.B.M.C., Inc., 114 Wn.2d 454, 788 P.2d 545 (1990). 5 No. 61057-4-II DISCUSSION I. LEGAL PRINCIPLES AND STANDARD OF REVIEW In WISHA appeals, we sit in the same position as the superior court in reviewing the Board’s decision. Dep’t of Lab. & Indus. v. Tradesmen Int’l, LLC, 198 Wn.2d 524, 534, 497 P.3d 353 (2021). We review the BIIA’s decision on its own record. Id. We determine whether the BIIA’s findings of fact are supported by substantial evidence and whether they support its conclusions of law. Id. In Stute, our supreme court held that general contractors have a duty to comply with WISHA regulations regarding oversight of all employees, including subcontractor employees, on the worksite. 114 Wn.2d. at 463. The court relied on the “specific duty” clause of RCW 49.17.060(2), that states employers “[s]hall comply with the rules, regulations, and orders promulgated under this chapter.” Stute, 114 Wn.2d at 457. This clause imposes a specific duty on employers to comply with WISHA regulations, and extends to subcontractors when a party asserts that the employer did not follow particular WISHA regulations. Id. In determining that general contractors have a duty to protect the safety of all employees on a worksite, the Stute court reasoned, “A general contractor’s supervisory authority places the general in the best position to ensure compliance with safety regulations. For this reason, the prime responsibility for safety of all workers should rest on the general contractor.” Id. at 463. Here, L&I cited DHI for several serious specific WISHA violations. Specifically, L&I cited DHI for violating former WAC 296-880-30005(1)(c) (2020) which requires the employer to “ensure that a fall arrest system, fall restraint system, or positioning device system is provided, installed, and implemented . . . when employees are exposed to fall hazards of ten feet or more to 6 No. 61057-4-II the ground or lower level while. . . [e]ngaged in the erection or placement of structural members;” former WAC 296-880-20005(6) (2020) which requires the employer to “ensure that employees exposed to fall hazards of four feet or more while working on a roof with a pitch greater than four in twelve use” fall protection; WAC 296-880-10020(1) which requires the employer to “develop and implement a written fall protection work plan including each area of the work place where the employees are assigned and where fall hazards of ten feet or more exist;” WAC 296-155-350(3) which requires “[e]mployees using hand and power tools and exposed to the hazard of falling, flying, abrasive, and splashing objects, or exposed to harmful dusts, fumes, mists, vapors, or gases must use the particular personal protective equipment necessary to protect them from the hazard;” and WAC 296-155-110(9) which requires the employer to “document walk-around safety inspections and such documentation must be available for inspection by personnel of the department.” To establish a prima facie case of a serious violation of a WISHA regulation, L&I must prove: (1) the cited standard applies; (2) the requirements of the standard were not met; (3) employees were exposed to, or had access to, the violative condition; (4) the employer knew or, through the exercise of reasonable diligence, could have known of the violative condition; and (5) there is a substantial probability that death or serious physical harm could result from the violative condition. Express Constr. Co. v. Dep’t of Lab. & Indus., 151 Wn. App. 589, 597-98, 215 P.3d 951 (2009); WAC 263-12-115(2)(b).2 We apply this standard when reviewing Stute citations against general 2 WAC 263-12-12-115 was amended effective December 15, 2024. Because the amendment did not affect subsection (2)(b), we cite the current version. 7 No. 61057-4-II contractors. Express Constr. Co., 151 Wn. App. at 597-98; J.E. Dunn Nw. v. Dep’t of Lab. & Indus., 139 Wn. App. 35, 44-48, 156 P.3d 250 (2007). II. GENERAL CONTRACTOR LIABILITY DHI asks this court to adopt the federal OSHA analysis for a general contractor’s liability, which, DHI contends, recognizes that the “non-delegable duty of care for general contractors is not the same as the duty owed by the subcontractor to its own employees.” Br. of Appellant at 50. Under this test, DHI argues, “[t]he burden is on the Secretary to prove [a] ‘reasonable [person]’ standard of employer conduct; and in the absence of such evidence the citation must be dismissed even where, it may seem, the employee misconduct was probably feasibly preventable.” Id. at 20. DHI contends that the Stute court adopted the federal “ ‘controlling employer’ doctrine.” Id. at 28. But in Stute, our supreme court held that “[a] general contractor’s supervisory authority is per se control over the workplace, and the duty is placed upon the general contractor as a matter of law.” Stute, 114 Wn.2d at 464. Relatedly, DHI asks us to hold that a general contractor’s role in supervision of work should be secondary and not primary. But our supreme court explicitly held that “the prime responsibility for safety of all workers should rest on the general contractor.” Id. at 463. Our supreme court’s rulings are binding on this court. State v. Gore, 101 Wn.2d 481, 486- 87, 681 P.2d 227 (1984). In Washington State, it is well established that, for L&I to hold a general contractor liable for a Stute violation, it must prove: (1) the cited standard applies; (2) the requirements of the standard were not met; (3) employees were exposed to, or had access to, the violative condition; (4) the employer knew or, through the exercise of reasonable diligence, could have known of the violative condition; and (5) there is a substantial probability that death or serious physical harm could result from the violative condition. 8 No. 61057-4-II Express Constr. Co., 151 Wn. App. at 597-98; J.E. Dunn Nw., 139 Wn. App. at 44-45, 48. DHI argues that applying the same test to Stute violations by general contractors as is applied to direct violations by subcontractors contradicts the BIIA’s holding in In re Exxel Pacific, Inc., No. 96 W182, 1998 WL 718040, at *5 (Wash. Bd. of Indus. Ins. Appeals July 6, 1998), that “proof of a cited safety violation [does not] constitute sufficient proof the responsibility [for safety on the jobsite] was not met.” (Emphasis omitted.) But the fourth element requires L&I to prove that the general contractor had actual or constructive knowledge of the violation by the subcontractor. Express Constr. Co., 151 Wn. App. at 599. Accordingly, and contrary to DHI’s concern, a general contractor is not strictly liable where a subcontractor commits a violation. Rather, L&I must prove that the general contractor knew, or through the reasonable exercise of diligence could have known, of the violative condition. Id. We decline DHI’s invitation to deviate from binding and established precedent. III. SUBSTANTIAL EVIDENCE OF KNOWLEDGE OF THE WISHA VIOLATIONS To sustain a serious violation of a WISHA safety regulation, L&I must prove that “the employer knew or, through the exercise of reasonable diligence, could have known of the violative condition.” Id. at 597-98. An employer has constructive knowledge of a violation, where the violation was in plain view, meaning the violation was “ ‘readily observable or in a conspicuous location in the area of the employer’s crews.’ ” Potelco, Inc. v. Dep’t of Lab. & Indus., 194 Wn. App. 428, 439-40, 377 P.3d 251 (2016) (quoting Erection Co. v. Dep’t of Lab. & Indus., 160 Wn. App. 194, 207, 248 P.3d 1085 (2011)). A supervisor’s constructive knowledge can be imputed to the employer. Id. at 440. 9 No. 61057-4-II DHI argues that substantial evidence did not support the BIIA’s finding that DHI had actual or constructive knowledge of the WISHA violations. DHI contends that it did not have actual knowledge of the violations because the superintendents were inside the job trailer where they could not see the violations. And, DHI argues, it did not have constructive knowledge of the violations because “it is not reasonable, nor required, for upper tier general contractors to constantly observe subcontractor employees.” Br. of Appellant at 26. Because it is undisputed that none of the superintendents actually saw the violations in progress, we agree that DHI did not have actual knowledge of the violations. However, we conclude that DHI had constructive knowledge of the violations. DHI compares this case to In re Acropolis Constr., LLC, No. 23 W1214, 2024 WL 5336676, at *2 (Wash. Bd. of Indus. Ins. Appeals Dec. 16, 2024), arguing that, as in Acropolis, although the violation was in plain view, it was not reasonable for DHI to observe the subcontractor employees. But in Acropolis, the BIIA concluded it was not reasonable to expect the general contractor to observe violations committed by a suspended employee who was working on a day when no work was scheduled. Id. Here, the violations occurred on a workday when the superintendents were present on the site. And the violations were in plain view. They were readily viewable from the street and from just outside of the job trailer. Moreover, DHI itself had recently cited Northwest Framing for fall safety violations and Houston expressed concerns over Northwest Framing’s fall protection to his supervisors. Accordingly, substantial evidence supported the BIIA’s finding that DHI had at least constructive knowledge of the violations. 10 No. 61057-4-II IV. SUBSTANTIAL EVIDENCE OF WILLFULNESS “[A] ‘willful violation’ is one involving a ‘voluntary action, done either with an intentional disregard of or plain indifference to the requirements of the statute.’ ” Elder Demolition, Inc. v. Dep’t of Lab. & Indus., 149 Wn. App. 799, 807, 207 P.3d 453 (2009) (quoting administrative record). DHI argues that there was not substantial evidence in the record that DHI’s violations were willful because DHI could not be plainly indifferent to complying with a duty that has yet to be clearly defined. We disagree. DHI’s argument that its duty had not been clearly defined is undercut by the fact that it had previously been cited for violating the standards in question. And DHI clearly was on notice that the violative conditions could exist because it had previously documented fall safety violations by Northwest Framing and Houston expressed his concerns about Northwest Framing to his supervisors. Although DHI represented that its supervisors spent most of the day in the field doing walk-around safety checks, it could not produce documentation for 6 of the 12 formal walk-around inspections for the prior 12 weeks. Moreover, this was not merely an issue of subcontractor employees failing to utilize provided equipment because there were no anchors available for the harnesses even though work on the trusses started the day before the inspection. And several subcontractor employees were violating safety regulations at the same time in three different houses. A thorough walk-around safety inspection would have revealed these deficiencies. Accordingly, substantial evidence supported the BIIA’s finding that the fall safety violations were willful. 11 No. 61057-4-II V. ADMISSIBILITY OF DEPOSITION We review the IAJ’s evidentiary decisions for abuse of discretion. McClure & Sons, Inc. v. Dep’t of Lab. & Indus., 16 Wn. App. 2d 854, 862, 487 P.3d 186 (2021). The appellant has the burden of demonstrating that the IAJ abused its discretion on appeal. Id. “[E]rror without prejudice is not grounds for reversal.” Brown v. Spokane County Fire Prot. Dist. No. 1, 100 Wn.2d 188, 196, 668 P.2d 571 (1983). DHI argues that the IAJ abused its discretion by excluding a deposition transcript from evidence. L&I argues that the IAJ did not abuse its discretion by declining to admit the deposition into evidence because it was not relevant and because any error was not prejudicial. We agree with L&I. The deposition at issue was of Terry Walley, a DOSH compliance operations manager. According to Walley, the directive was formulated to give inspectors guidance on how to implement Stute, 114 Wn. 2d 454. DOSH Directive 27.00 states that, under WISHA, general contractors have the ultimate responsibility for worker job safety at the job site. Walley also explained that while an initial version of the directive stated that general contractors are not strictly liable for WISHA violations by their subcontractors and that general contractors have only a general duty of care, subsequent versions of the directive state that courts now hold general contractors per se liable for subcontractor violations. DHI argues that the deposition showed that DOSH Directive 27.00 was inconsistent with the BIIA’s holding in Exxel Pacific, No. 96 W182, that, according to DHI, L&I adopted the federal OSHA standard for general contractor liability. And, DHI argues, because L&I employees comply with the directive, L&I incorrectly enforces Stute violations. 12 No. 61057-4-II But DHI has not demonstrated that it was prejudiced by the IAJ’s decision not to admit the deposition transcript. DHI fails to articulate how exclusion of the deposition prevented it from arguing its theory of the law to the IAJ. DHI could have, and did, present its theory of the law to the IAJ by citing case law and administrative decisions. The fact that L&I, in DHI’s view, incorrectly understood the law at the time of enforcement is irrelevant. CONCLUSION We conclude (1) the BIIA did not err by applying established and binding precedent rather than adopting the federal test for multi-employer work sites, (2) substantial evidence supported the BIIA’s finding that DHI had constructive knowledge of Northwest Framing’s WISHA violations because the violations occurred in plain view on a day when DHI superintendents were working on the job site, were visible from outside the job trailer, and DHI had already observed several fall safety violations by Northwest Framing employees, (3) substantial evidence supported the BIIA’s finding that the violations were willful because DHI was aware of its obligations and failed to adequately ensure subcontractor safety, and (4) DHI has not demonstrated that it was prejudiced by the BIIA’s decision to exclude the deposition from evidence. Accordingly, we affirm. A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040, it is so ordered. 13 No. 61057-4-II CRUSER, J. We concur: VELJACIC, C.J. MAXA, J. 14