Bays v. SUMMITT TRUCKING, LLC
| Decision Date | 25 February 2010 |
| Docket Number | Civil Action No. 07-571-C. |
| Citation | 691 F. Supp.2d 725 |
| Parties | James F. BAYS, Plaintiff, v. SUMMITT TRUCKING, LLC, et al., Defendants. |
| Court | U.S. District Court — Western District of Kentucky |
Ronald P. Hillerich, Louisville, KY, for Plaintiff.
Robert D. Bobrow, Robert Estes Stopher, Boehl Stopher & Graves, LLP, Bradley R. Hume, Kevin M. Murphy, Thompson Miller & Simpson PLC, Louisville, KY, for Defendants.
This matter is before the court upon the motion for summary judgment by defendant Summitt Trucking, LLC (R. 49); the motion for declaratory judgment by intervener Great American Assurance Co. (R. 73); and the motion for summary judgment by defendant Donald Dekalands (R. 64). The court will deny Summitt's motion, grant Great American's motion, and deny Dekalands's motion.
Dekalands hauled loads for Summitt Trucking, LLC ("Summitt"). He operated a Freightliner semi-tractor that his wife owned and which was leased to Summitt. On September 29, 2007, Dekalands drove the semi-tractor, hitched to a trailer holding a load of freight, to the Summitt freight yard. After dropping off the trailer and its load, he began to drive home in the tractor. En route, he entered the lane of oncoming traffic and struck the vehicle driven by the plaintiff, James Bays. Bays brought this suit seeking damages for his injuries.
Dekalands and Summitt had entered into an Independent Contractor Agreement. R. 49, Ex. 1. Under the terms of the agreement, Dekalands was the owner-operator, or "CONTRACTOR," of the semi-tractor and Summitt was the "CARRIER." Id. at 1. The Agreement provided that it was Summitt's responsibility to obtain liability insurance for the vehicle "at all times while it is being operated on behalf of Summitt." Id. at App. B, ¶ 1. Summitt obtained such an insurance policy from Liberty Mutual Insurance Company.
The Agreement also required Dekalands to obtain liability insurance that would provide coverage "whenever the semi-tractor is not being operated on behalf of Summitt." Id. at ¶ 2. Dekalands's wife obtained a "Non-Trucking Liability Policy" with Great American Assurance Co. ("GAAC") on June 29, 2007. The policy contained an exclusion for any liability "arising out of any accident which occurs while the covered auto is being used in the business of anyone to whom the covered auto is leased, rented, or loaned or while the covered auto is being used to transport cargo of any type." R. 66, Ex. 1, Part 2, ¶ C13.
At the time of the accident, the tractor driven by Dekalands displayed Summitt's ICC Certificate and a "Summitt" decal on the driver's door. The Independent Contractor Agreement and the two insurance policies were also in effect.
Bays filed suit against Summitt Trucking (R. 1), and later added Donald Dekalands (R. 19). BlueCross BlueShield of Alabama (BCBS), the administrator of Bays's employee group health benefit plan, intervened (R. 30) and Summitt responded with a motion for summary judgment (R. 49). After that, GAAC intervened (R. 66) and Dekalands added a third-party defendant, "John Doe," the unidentified driver of a van that Dekalands claims was negligently stopped in his lane that he was allegedly attempting to avoid when he swerved into oncoming traffic and collided with Bays (R. 62). Dekalands filed a motion for summary judgment (R. 64), and GAAC filed a motion for declaratory judgment (R. 73).
Due to Summitt Trucking's notice of bankruptcy, this court issued an order on May 20, 2009 (R. 91), 2009 WL 1421017, denying without prejudice the three pending motions in this matter and staying proceedings (R. 79). Pursuant to the notice and modification and lifting of bankruptcy automatic stay, filed on September 17, 2009 (R. 94), and telephonic status conference on December 8, 2009 (R. 99), the court will consider each of the three motions in turn.
Summary judgment is appropriate only when there are no genuine issues of material fact and the moving party is entitled to a judgment as a matter of law. Fed. R.Civ.P. 56; Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The court must view all of the evidence in the light most favorable to the party opposing summary judgment. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962). Because Interstate Commerce Commission ("ICC")1 regulation 49 C.F.R. § 376.12 establishes a rebuttable presumption that Dekalands was acting within the scope of his employment while driving the leased semi-tractor at the time of the accident, and because Summitt has not overcome that presumption by proof that Dekalands was acting outside the scope of his employment when the accident occurred, the court will deny Summitt's motion.
The lease establishing the agreement between Dekalands and Summitt Trucking is governed by an ICC regulation that states:
49 C.F.R. § 376.12.
The resolution of liability in this case turns on the interpretation of section (c)(1) of the regulation, which gives the carrier-lessee "complete responsibility for the operation of the equipment for the duration of the lease." The liability of the carrier-lessee is determined under the doctrine of respondeat superior, and 49 C.F.R. § 376.12 creates a rebuttable presumption that Dekalands was acting within the scope of his employment as he bobtailed2 home after completing a trip for Summitt. Wilcox v. Transamerican Freight Lines, Inc., 12 Ohio Misc. 162, 371 F.2d 403 (6th Cir.1967).
This court is not persuaded by Bays's argument that the Sixth Circuit rejected the Wilcox rule and embraced strict liability in Johnson v. S.O.S. Transport, Inc., 926 F.2d 516 (6th Cir.1991), by commenting, in dicta, that 49 C.F.R. § 376.12 "undoubtedly . . . renders lessee carriers vicariously liable, notwithstanding traditional principles of agency, for injuries sustained by third parties resulting from the negligence of the drivers of the leased vehicles." Id. at 521. To the contrary, the Sixth Circuit's statement in Johnson that "Congress intended that carriers who use leased equipment would be subjected to the same requirements . . . to which they would be subjected in using equipment owned by them" reaffirmed part of the Wilcox holding that is pertinent for the resolution of this case. Id. at 523. That is, a carrier-lessee should not have greater liability, and certainly should not be strictly liable, for a negligent act of an owner-driver where such carrier would not be liable for a similar act of negligence by its own employees or when using its own equipment. See Parker v. Erixon, 123 N.C.App. 383, 473 S.E.2d 421, 426 (N.C.Ct.App.1996).
Moreover, Johnson was decided prior to the 1992 amendments to the ICC regulations, discussed more fully infra, and the Johnson court distinguished the issue before it—carrier liability under the ICC regulations for injuries sustained by the driver of the leased vehicle—from the issue before this court—carrier liability under the ICC regulations for third parties. Id. at 522. The instant case and Johnson are further factually distinguishable. The driver in Johnson was unquestionably within the scope of his employment, hauling a load for the carrier-lessee, when he was in a fatal accident, while Dekalands was bobtailing and arguably outside the scope of his employment when he collided with Bays. Id. at 518. The Johnson court did not address whether the driver was acting on behalf of the lessee-carrier at the time of the alleged negligence, perhaps because it was so obvious. Thus, Johnson cannot be read to dispose of the necessity of analyzing the scope of employment in all carrier liability cases. In fact, Johnson included a footnote comparing its sweeping statement of strict vicarious liability to Wilcox's holding that a carrier-lessee was not liable for the negligence of an owner-driver who had completed his assignment at the time of the collision and was outside the scope of his employment. Id. at 522 n. 13.
Gilstorff v. Top Line Express, Inc., No. 96-3081, 1997 WL 14378 (6th Cir. Jan. 14, 1997), also does not impose strict vicarious liability on Summitt. The Gilstorff court observed that "most courts have concluded as a matter of federal law that the ICC regulations impose an irrebuttable statutory employment relationship between the driver and carrier-lessee," but noted that "the Sixth Circuit has not yet done so however." 1997 WL 14378, at *2 n. 6. It then cited several cases criticizing Wilcox and noted that one, Wyckoff Trucking, Inc. v. Marsh Bros. Trucking Serv., Inc., 58 Ohio St.3d 261, 569 N.E.2d 1049 (Ohio 1991), which held that the ICC regulations create an irrebuttable presumption of an employment relationship, "is an accurate statement...
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