Degenhart v. Knights of Columbus

Decision Date21 April 1992
Docket NumberNo. 23684,23684
Citation420 S.E.2d 495,309 S.C. 114
CourtSouth Carolina Supreme Court
PartiesWilliam J. DEGENHART, Vincent J. Degenhart, and Robert W. Degenhart, Appellants, v. KNIGHTS OF COLUMBUS, Respondent. . Heard

Paul V. Degenhart, Columbia, for appellants.

Val H. Stieglitz, of Nexsen, Pruet, Jacobs & Pollard, Columbia, for respondent.

HARWELL, Chief Justice:

Appellants William J. Degenhart, Vincent J. Degenhart, and Robert W. Degenhart (the Degenharts) assert that the master-in-equity erred in holding that respondent Knights of Columbus was not liable for the acts of its agent, Michael A. Aun, II. We affirm.

I. FACTS

Knights of Columbus is a fraternal, non-profit organization that offers life insurance, health insurance, and annuities to its members. Aun and Knights of Columbus entered into a Field Agent Contract wherein Aun was authorized to solicit and procure applications for life and health insurance on the lives of members of Knights of Columbus. Aun agreed that he would "not engage in any other occupation or business, except as authorized by [Knights of Columbus]."

Contrary to the Field Agent Contract, Aun established a real estate business. Aun initially contacted the Degenharts in his capacity as insurance agent for Knights of Columbus. He subsequently induced the Degenharts to invest over $250,000 in various partnerships created by him for the purposes of owning and managing rental properties. When the investments failed, the Degenharts brought an action against Aun and Knights of Columbus, alleging, among other things, that they were injured by Knights of Columbus's failure to properly supervise and manage Aun's activities.

The master-in-equity found that the Degenharts were aware that Aun promoted his various business ventures for his own benefit, and not for the benefit or profit of Knights of Columbus. He also found that Knights of Columbus possessed no notice of Aun's outside activities. Accordingly, the master-in-equity found that Aun was acting outside the scope of his authority as agent for Knights of Columbus. The master-in-equity discerned no genuine issue of fact tending to demonstrate that Knights of Columbus had notice of Aun's outside real estate activities sufficient to create a duty on the part of Knights of Columbus to supervise the activities. The master-in-equity therefore granted summary judgment in favor of Knights of Columbus.

II. DISCUSSION

The Degenharts assert that because Knights of Columbus entrusted its members to Aun, it owed a duty to its members, including the Degenharts, to implement adequate safeguards to monitor and enforce Aun's contract. We disagree.

Initially, we note that the question is not whether Knights of Columbus had notice of Aun's activities. Rather, the dispositive issue is whether Knights of Columbus owed the Degenharts a duty, and, if so, the extent of that duty. If Knights of Columbus owed no duty to the Degenharts to protect them from the harm they suffered, notice is immaterial. This is because the common law ordinarily imposes no duty on a person to act. Rayfield v. South Carolina Department of Corrections, 297 S.C. 95, 100, 374 S.E.2d 910, 913 (Ct.App.1988). Thus, a person usually incurs no liability when he fails to take steps to protect others from harm not created by his own wrongful conduct. Id.

Under certain circumstances, an employer is under a duty to exercise reasonable care to control an employee acting outside the scope of his employment. An employer may be liable for negligent supervision if the employee intentionally harms another when he:

(i) is upon the premises in possession of the [employer] or upon which the [employee] is privileged to enter only as his [employee], or

(ii) is using a chattel of [the employer], and ... [the employer]

(i) knows or has reason to know that he has the ability to control his [employee], and

(ii) knows or should know of the necessity and opportunity for exercising such control.

Restatement (Second) of Torts...

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102 cases
  • Wingate v. Byrd
    • United States
    • U.S. District Court — District of South Carolina
    • September 30, 2016
    ...be liable for negligent supervision if an employee intentionally harms another. (ECF No. 118 at 23 (citing Degenhart v. Knights of Columbus , 309 S.C. 114, 420 S.E.2d 495, 496 (1992) ).)Although Plaintiff now contends that this cause of action also alleges negligent and grossly negligent co......
  • C.C. v. Harrison Cnty. Bd. of Educ.
    • United States
    • West Virginia Supreme Court
    • June 17, 2021
    ..."[a]n employer may be liable for negligent supervision if the employee intentionally harms another[.]" Degenhart v. Knights of Columbus , 309 S.C. 114, 420 S.E.2d 495, 496 (1992). For instance, when a plaintiff alleged that a church's hierarchy negligently failed to supervise and prevent in......
  • Doe v. St. Francis Hosp. & Med. Ctr.
    • United States
    • Connecticut Supreme Court
    • July 16, 2013
    ...that employee at facility for disabled persons was known to exhibit aggressive behavior toward patients); Degenhart v. Knights of Columbus, 309 S.C. 114, 116–17, 420 S.E.2d 495 (1992) (claim of negligent supervision insufficient under South Carolina law and § 317 because evidence failed to ......
  • Callum v. CVS Health Corp.
    • United States
    • U.S. District Court — District of South Carolina
    • September 29, 2015
    ...the employer knew or should have known of the necessity and opportunity for exercising such control. Degenhart v. Knights of Columbus, 309 S.C. 114, 116–17, 420 S.E.2d 495, 496 (1992). Supervisory liability requires the court to focus on whether the employer knew or should have known about ......
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1 books & journal articles
  • Employees Behaving Badly
    • United States
    • South Carolina Bar South Carolina Lawyer No. 28-3, November 2016
    • Invalid date
    ...being, is not within the scope of his employment so as to render the master liable therefor.”). [4] See Degenhart v. Knights of Columbus, 309 S.C. 114, 420 S.E.2d 495 (1992); Kase v. Elbert, 392 S.C. 57, 64, 707 S.E.2d 456, 460 (Ct. App. 2011) (adopting Restatement (Second) of Torts § 317).......

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