Gackstetter v. Dart Transit Company

• Decision Date: 21 August 1964
• Docket Number: No. 38879,38879
• Citation: 130 N.W.2d 326,269 Minn. 146
• Parties: Charles GACKSTETTER, Appellant, v. DART TRANSIT COMPANY, et al., Defendants, Dart Transit Company, Respondent.
• Court: Minnesota Supreme Court

Page 326

130 N.W.2d 326

269 Minn. 146

Charles GACKSTETTER, Appellant, v. DART TRANSIT COMPANY, et al., Defendants, Dart Transit Company, Respondent.

No. 38879.

Supreme Court of Minnesota.

Aug. 21, 1964.

Rehearing Denied Oct. 1, 1964.

Syllabus by the Court

1-2. Where a tractor-truck is leased by the owner to a common carrier and its exclusive possession, control, use, and responsibility to the public for safe operation is entrusted and assumed by the carrier for the purpose of performing activities which can only be carried on under a franchise granted by public authority, the carrier-lessee is not subject to liability for the negligence of the owner-lessor when the vehicle is operated by the latter outside the course and scope of his employment, even though operated with the consent of the carrier-lessee.

Mahoney & Mahoney, Richard P. Mahoney, Peter J. Hiniker, Minneapolis, for appellant.

Firestone, Fink, Krawetz, Miley & O'Neill, St. Paul, for respondent.

ROGOSHESKE, Justice.

Action to recover for personal injuries sustained in a collision between plaintiff's motor vehicle and defendant George Merrell's tractor-truck that was being operated while under a lease to defendant Dart Transit Company. At the conclusion of the evidence, the court directed a verdict on the issue of liability against defendant Merrell and in favor of defendant Dart. Plaintiff appealed from the judgment entered in Dart's favor.

Two questions are presented: Whether the tractor was being operated by Merrell in the course and scope of his employment with Dart, and whether the relationship between Dart and Merrell as expressed by the terms of the lease agreement required by Federal and state regulations makes Dart liable for Merrell's negligence any time he operated the tractor with Dart's Permission.

The accident happened on August 19, 1959, in St. Paul. As plaintiff was driving his automobile south on Robert Street it was struck from behind by another vehicle propelled by the force of having been struck from behind by a tractor-truck driven by defendant George Merrell. At the time of the accident the tractor was owned by defendant Merrell but was under an exclusive lease to defendant Dart Transit Company. Dart is a specialized common carrier operating under certificates issued by the Interstate Commerce Commission and the Minnesota Railroad and Warehouse Commission. The lease instrument which was prepared by the carrier-lessee contained provisions required by the rules of the I.C.C. and is the basis upon which the plaintiff sought to hold Dart liable for Merrell's negligence. The critical provision is as follows:

'It is understood that The leased equipment under this agreement Is in the exclusive possession, control, and use of the authorized carrier, Lessee, and that the said Lessee assumes full responsibility in respect to the equipment it is operating, to the public, the shippers and the I.C.C. (The lessee shall be considered as owner for the purpose of sub-leasing under the rules of the I.C.C. to other authorized Carriers during the duration of this lease.)' (Italics supplied.) ¹

Since the date of the lease on March 3, 1959, Merrell drove the leased tractor, referred to above as the leased equipment, in hauling trailers for Dart to various parts of the country in accordance with dispatch orders and directions issued by Dart. He kept and filed with Dart a daily log of his activities and identified the tractor with appropriate placards or decals bearing Dart's name, address, and permit numbers in accordance with the rules of the I.C.C. Dart financed the costs of maintenance for Merrell, permitting him to reimburse them and to use their garage for repairs. They deducted 25 percent of the freight charges earned by Merrell to cover trailer rentals, charges for services in securing loads, and other operating expenses. Shortly before the accident on August 19, Merrell drove his tractor from the Fruehauf Trailer Company (where it had been painted) to Dart's terminal to advise them that he was ready for a load the next morning. The president and dispatcher of Dart gave Merrell new placards or decals to affix to the tractor and gave Merrell instructions and a 'trip settlement sheet' which directed him to pick up a trailer loaded with glue at the Armour & Company plant at South St. Paul the next morning, August 20, 1959, and to take it to Chicago. Merrell testified that after receiving these instructions he told them that he was going to drive to his home at Hampton, Minnesota, located south of St. Paul. Although Mr. Oren, the president of Dart, testified at one point in the trial that Merrell was definitely instructed that the tractor should remain in St. Paul at the terminal when he was not engaged in hauling trailers, no objection was made to this use of the tractor. Since Merrell testified he made such use of the tractor on other occasions with Dart's knowledge, we must conclude that Dart's failure to object implied consent. As Merrell testified further, it was customary for him to receive instructions in the form of a 'trip settlement sheet' at Dart's terminal. In this instance he received no advance on the profits he would receive from the load to be hauled for Armour, but he often did receive such advance contemporaneously with his instructions. It also appears that the route taken by Merrell from the terminal to go to his home passed by the Armour & Company plant. The accident occurred before he had reached this point on the route. He reported the accident to Dart. Merrell stated that he intended to go directly to his home as was his custom, but he also said that in the course of driving he might have 'changed his mind' and stopped at Armour 'to see if the trailer had all of the tires on or not.' On the daily log sheet, required to be kept by every driver operating under a franchise, Merrell indicated that he was 'off duty' the entire working day of August 19.

By virtue of the I.C.C. rules and the provision of the lease quoted above under which nonowned equipment may be operated under a carrier franchise, it is clear, and the parties agree, that because Merrell's use and operation of the tractor was subject to the exclusive control of Dart, the relationship of master and servant existed. Accordingly, if Merrell was acting in the course of his employment at the time of the accident, his negligence may be imputed to Dart. ² Thus, as a franchised motor carrier Dart cannot evade liability for the negligence of the owner-lessor upon the defense that the owner is an independent contractor. The effect of the rules and the lease is to make the owner-driver an employee of the lessee. ³

1. A servant must be acting primarily for the benefit of his master at the time of the tort in order to find that the act was within the course and scope of the servant's employment and thereby imposes vicarious liability for the servant's conduct. If the tort is committed when the servant is in pursuit of activity personal to himself, the master is not liable. ⁴

The court ruled that as a matter of law Merrell was engaged in a personal mission. From a review of the testimony most favorable to plaintiff, we are obliged to agree that the evidence is insufficient to support a reasonable inference that Merrell's trip home was a necessary incident of his employment or actuated by an intention to serve Dart. ⁵ He recorded on his log sheet that he was off duty. His route could not reasonably be regarded otherwise than as incidental to his personal desires and thus unrelated to Dart's business. The only evidence that could arguably support a contrary inference is his testimony that he might have stopped at Armour's to check the trailer tires. At best, this is speculative. In our opinion the trial court was correct in concluding that Merrell was not acting within the course and scope of his employment. ⁶

2. Since the record suggests that Merrell may be unable to respond in damages, ⁷ plaintiff argues by analogy to § 170.54 of the Safety Responsibility Act and its underlying policy that we should accept his second theory--that the effect of the rules of the regulating agencies and the lease is to render Dart liable for any negligent operation of the tractor. ⁸ The trial court in rejecting this position stated:

'* * * Plaintiff's contention on this phase of the matter amounts to an assertion that the effect of these regulations and the lease is to impose for the period of the lease an absolute liability upon Dart for any negligence of Merrell in driving the Mack tractor. If plaintiff is correct in this contention, then it makes no difference whether Merrell was on business for Dart or whether he was on a personal mission of his own. At the time of directing the verdict the Court stated that our Supreme Court had not passed upon this question but that in examining cases from other jurisdictions it appeared that liability was not imposed on an absolute basis and appeared to be based on whether at the time the driver-owner was in the...