Hertz Corporation v. Ralph M. Parsons Company

• Decision Date: 29 August 1968
• Docket Number: Civ. No. 64-134-Orl.
• Citation: 292 F. Supp. 108
• Parties: The HERTZ CORPORATION, a Delaware corporation, authorized to do business in the State of Florida, Plaintiff, v. RALPH M. PARSONS COMPANY, a Nevada corporation, authorized to do business in the State of Florida, Defendant.
• Court: U.S. District Court — Middle District of Florida

292 F. Supp. 108

The HERTZ CORPORATION, a Delaware corporation, authorized to do business in the State of Florida, Plaintiff, v. RALPH M. PARSONS COMPANY, a Nevada corporation, authorized to do business in the State of Florida, Defendant.

Civ. No. 64-134-Orl.

United States District Court D. Florida, Orlando Division.

August 29, 1968.

W. David Rogers, Jr., Orlando, Fla., for plaintiff.

Monroe E. McDonald, Orlando, Fla., for defendant.

OPINION ON MOTIONS FOR SUMMARY JUDGMENT

GEORGE C. YOUNG, District Judge.

This case is the second appearance in different form of an accident and the resulting circumstances which occurred on September 23, 1962. This Court now passes on the cross motions of the plaintiff and the defendant here for summary judgment.

The undisputed facts are that on September 23, 1962, John P. Nugent, Jr. (hereinafter Nugent), then an employee of the defendant here, Ralph M. Parsons Company (hereinafter Parsons), arrived at the Orlando, Florida, Airport on a business trip for his aforesaid employer which had set up an appointment for him at Cape Canaveral (now Cape Kennedy), Florida. His employer had made his plane and motel reservations, but upon arriving at the Orlando Airport, Nugent himself arranged for the rental of an automobile from the plaintiff here, for the purpose of transporting himself from the Orlando Airport to the motel in the Cape area where accommodations had been arranged for him. He used a credit card furnished by his employer in renting The Hertz Corporation (hereinafter Hertz) automobile and his employer subsequently paid the rental charge.

The accident which gave rise to this dispute occurred on the road between the Orlando Airport and the motel at Cocoa, Florida, while Nugent was en route. A head-on collision occurred between the car driven by Nugent and another car containing a driver and five passengers. Nugent and two of the persons in the other automobile were both instantly killed and four of the passengers were seriously injured. Lawsuits filed by the survivors in the other car against Nugent and Hertz resulted in judgments against Hertz and Nugent in this Court which were ultimately settled by the payment of $550,000.00.

The plaintiff, Hertz, paid $530,000.00 of the $550,000.00 judgment, having received a contribution of $20,000.00 from the insurance carrier of Nugent and so Hertz seeks indemnification in this case from Parsons.¹

By previous order of this Court entered April 29, 1966, this Court held that inasmuch as Hertz insured its lessee for $300,000.00 as a part of the rental agreement, it could not recover from either Nugent or the latter's employer any part of that amount so that the amount remaining in controversy here is the balance of $230,000.00.

At the previous trial before this Court wherein the injured parties were the plaintiffs, both parties to the present proceeding were co-defendants along with the estate of Nugent and the same law firm represented them as now represents Hertz. In the damage suit the plaintiffs there had served a request for admission on counsel representing Hertz, Parsons, and the estate of Nugent, requesting an admission that Nugent at the time of the accident was acting in the course and scope of his employment with Parsons. Counsel for said defendants (who now represents Hertz here) never filed or served a response to that request for admission and therefore, pursuant to Federal Rules of Civil Procedure the request was held to have been admitted and the trial proceeded on that basis.

The present counsel for Parsons now seeks to relitigate the employment issue whereas the plaintiff here contends that that question has already been determined in the previous damage suit in which both parties here were parties defendant there.

Hertz contends that the doctrine of estoppel by judgment bars further consideration of the employment issue in this action. While not agreeing that the doctrine of estoppel by judgment is applicable here, it is the opinion of this Court that considering the undisputed evidence on the motion for summary judgment, there is no factual dispute on this issue and that, therefore, the employment issue can be determined as a matter of law in this suit. There is no evidence that Nugent at the time of the accident had made any deviation from the business purpose of the trip, nor is there any evidence that he was in Florida for any purpose other than to serve his employer. An employee whose work entails travel away from the employer's premises is within the course of his employment at all times during the trip other than when there is a distinct departure for nonessential personal errands. N. & L. Auto Parts Company v. Doman, 111 So.2d 270 (Fla.App.1959); Hardware Mutual Casualty Company v. Carlton, 150 Fla. 729, 8 So.2d 665 (1942), cited with approval in Thurston v. Morrison, 141 So.2d 291 (Fla.App.1962).

Having determined that on the basis of the undisputed facts that as a matter of law Nugent at the time of the accident was acting in the course and scope of his employment, with the defendant here, Parsons, the next issue is whether Hertz as the owner of the automobile is entitled to indemnification from the driver's employer.

The Fifth Circuit in General Dynamics Corp. v. Adams and Pan-American World Airways v. General Dynamics Corp., 340 F.2d 271 (1965), stated that Florida recognized three types of indemnity situations:

"The first of these, which is not in issue here, is the rare case in which one of two joint actors enters into a formal indemnity agreement * * *.

The second situation is that in which the owner of an automobile is permitted to sue the person who was driving the vehicle at the time of the negligent injury which subsequently resulted in a judgment against the owner.

The third group falls within the principle * * * that as between two persons either of whom may be guilty of negligence causing an injury to a third party, indemnity will be allowed `where the injury has resulted from a violation of the duty which one (defendant) owes the other, so that as between themselves, the act or omission of the one from whom indemnity is sought is the primary cause of the injury.'"

The second category is represented by the Florida case of Hutchins v. Frank E. Campbell, Inc., 123 So.2d 273 (Fla.App. 1960).

In the Hutchins case, Mrs. Hutchins loaned her car to her husband who was an officer of the defendant, Campbell Corp. Her husband sent two employees of the defendant corporation on an errand on behalf of the corporation. While they were on this errand they had an accident. The injured parties sued Campbell Corp., on the respondeat superior doctrine and Mrs. Hutchins, the owner of the automobile, on the dangerous instrumentality doctrine. Mrs. Hutchins in turn cross claimed against Campbell Corp. for indemnification.

The Court held that Campbell Corp. was liable to Mrs. Hutchins for the damages sustained by her due to the negligence of the defendant's employee. The fact that Mrs. Hutchins was liable for the original damage to the injured party under the dangerous instrumentality doctrine did not cause her to be considered in pari delicto with the Campbell corporation.

The theory behind the Hutchins case is that although the owner of the vehicle is liable, his liability is the result of imputed negligence. Therefore, between the active tortfeasor and the owner of the vehicle, the owner is secondarily liable and not in pari delicto. The owner and the active tortfeasors therefore are not joint tortfeasors and an action for indemnity lies.

Other Florida cases discuss this point. In Fincher Motor Sales, Inc. v. Lakin, 156 So.2d 672 (Fla.App....