McIntosh v. Neal-Blun Co.

• Decision Date: 21 May 1971
• Docket Number: 3,2,NEAL-BLUN,No. 46004,Nos. 1,46004,s. 1
• Citation: 123 Ga.App. 836,182 S.E.2d 696
• Parties: Kathryn O. McINTOSH v.COMPANY
• Court: Georgia Court of Appeals

Page 696

182 S.E.2d 696

123 Ga.App. 836

Kathryn O. McINTOSH v. NEAL-BLUN COMPANY.

No. 46004.

Court of Appeals of Georgia, Division Nos. 1, 2, 3.

May 21, 1971.

Syllabus by the Court

In the case sub judice a wholly owned family corporation furnished one of its vehicles, for both personal and business use, to its president who in turn permitted the unrestricted use of such vehicle by members of his family, all with the knowledge and consent of the corporate officers and stockholders. Nevertheless, where a third person is negligently injured by one driving the vehicle, with permission but on a purely personal mission the rule of respondeat superior or the family purpose car doctrine would not apply.

Kathryn Osborne McIntosh, appellant, brought an action for damages in the State Court of Chatham County against Nicholas K. Nelson, a minor, and Neal-Blum Company, appellee.

The appellant's complaint alleged that: on June 5, 1968, she was a passenger in a car owned by the appellee but in the custody of Neff McIntosh and being driven by Nelson with the consent and authority of Neff McIntosh; about midnight, while the car was being driven from Hilton Head Island, South Carolina, to Savannah, Georgia, Nelson drove the car into the rear of a truck which was preceding the car over the Talmadge Memorial Bridge, Chatham County, Georgia; as the result of the impact, the appellant suffered a spinal oblique fracture of the tibia and the fibula of her left leg.

The complaint further alleged that the car, owned by the appellee, is made available to its president, John M. McIntosh, the father of Neff McIntosh, for his personal use, pleasure, and enjoyment; at the time of the collision, the car was being used by Neff McIntosh with the appellee's knowledge, consent, and approval; the stock of appellee corporation is wholly ownd by the family of Mr. and Mrs. A. C. Neff, the grandfather and grandmother of Neff McIntosh, and the family of Mr. and Mrs. John M. McIntosh, his father and mother; Mr. Neff who is chairman of the board of the appellee and his wife are the majority stockholders; the appellee's car was being used by the family of John M. McIntosh for their pleasure, with the knowledge and consent of the stockholders and the two major corporate officers, the chairman of the board and the president.

The appellee answered denying liability and that the use of the appellee's car by Neff McIntosh was with the knowledge and consent of his father and with the knowledge and consent of the appellee. Ownership of the car by the appellee was admitted. The appellee denied that Nelson was operating its car with the consent and authority of Neff McIntosh. The appellee alleges that at the time of the collision Nelson was neither the agent, servant, or employee of the appellee and that the appellee's car was not being operated with its knowledge, consent, or approval or in the furtherance of the appellee's business.

The answer of Nelson admits the use of the car by the family of John M. McIntosh and that at the time of the collision Neff McIntosh was using the appellee's car with the knowledge, consent, and approval of the appellee. His answer also admits that he was driving the appellee's car with the consent and authority of Neff McIntosh.

The appellee filed a motion for summary judgment asserting that Nelson was operating the appellee's car without its knowledge, consent, or approval and that Nelson was not on any business of the corporation and was not an agent, servant, or employee of the corporation at the time of the collision. In support of the motion, the appellee filed an affidavit of John M. McIntosh, its president.

In opposition to the appellee's motion for summary judgment, the appellant filed the affidavit of Neff McIntosh. His affidavit declares that the appellee is a wholly owned family corporation in which all of the stock is owned by members of his family and his grandfather and grandmother, Mr. and Mrs. A. C. Neff. The affidavit recites that Nelson was driving the appellee's car on the neight of the collision at his request, with his authority, and under his supervision. In his affidavit, the affiant establishes that he had used the car periodically for eighteen months, as had other members of his family. He drove the appellee's car with the consent, knowledge, and approval of his father, his grandfather, and all of the stockholders. His affidavit concludes with the statement that no restrictions were placed upon the use of the appellee's car and that it had the same status in his family as any other car owned by his parents.

At the oral argument, the appellant admitted that there was no master-servant or principal-agent relationship between the appellee and Nelson other than that arising as a third person driver under the application of the 'family purpose car doctrine.' Following oral argument on the motion for summary judgment, the trial court entered an order on November 24, 1970, granting the appellee's motion.

Owen H. Page, Savannah, for appellant.

Falligant, Doremus & Karsman, Stanley Karsman, Savannah, for appellee.

QUILLIAN, Judge.

The question for determination as stated by counsel for the appellant is: 'Does the 'Family Purpose Car Doctrine' apply to a wholly owned family corporation which furnishes a vehicle owned by the corporation to its president for his personal and business use, and he permits the unrestricted use of the vehicle by members of his family with the knowledge and consent of corporate officers and stockholders, and while the vehicle is so used, a third person is injured because of negligence? Or does mere corporate ownership exculpate the corporation from liability?'

We cannot agree with the appellant's position because of that which was held in Harper v. Brown, 122 Ga.App. 316, 318, 176 S.E.2d 621: 'Operation of the master's vehicle by a servant with the master's knowledge, consent and permission, but on a mission purely personal to the servant, places the servant in the same position as that of any borrower of a vehicle, and as to the use of the vehicle on the personal mission the relationship is that of bailor and bailee only. A company is not chargeable with acts committed by its president in his individual capacity and for his personal benefit only. Hopkins v. City of Atlanta, 172 Ga. 254(2), 157 S.E. 473. And see Strickland v. Bank of Cartersville, 141 Ga. 565(4), 81 S.E. 886. It was held in Heath v. Atlanta Beer Distributing Co., 56 Ga.App. 494, 193 S.E. 73 that even though a tortfeasor is the owner and sole stockholder of the corporation, the corporation is not liable unles the tortfeasor is acting within the scope of his employment or in the line of business of the corporation at the time. Even though the company car was turned over to Harper as president without restrictions on his use, the rule of respondeat superior does not apply where the use was purely personal to Harper. See also Code §§ 105-108; McGuire v. Gem City Motors, D.C., 296 F.Supp. 541; Fulton Bag, etc., Mills v. Eudaly, 95 Ga.App. 644, 98 S.E.2d 235; Fielder v. Davison, 139 Ga. 509, 77 S.E. 618. Since the evidence demands a conclusion that Harper was on a purely personal mission at the time of the collision, the judgment against Allied Chemical Corp. is without evidence to support it.'

The family purpose car doctrine applies to a family and not to a corporation. In the case sub judice Nelson was not the agent or servant of the defendant Neal-Blun Company nor was he on any business of the defendant company at the time of the collision.

The granting of the summary judgment was not error.

Judgment affirmed.

BELL, C.J., HALL, P.J., and EBERHARDT, PANNELL, DEEN and WHITMAN, JJ., concur.

JORDAN, P.J., concurs in the judgment only.

EVANS, J., dissents.

EVANS, Judge (dissenting).

I would reverse the trial court in granting summary judgment on behalf of the defendant Neal-Blum Company, the corporate owner of the automobile involved in this tort action.

Of great importance is that said defendant corporation filed an answer in the State Court of Chatham County, Georgia, and admitted the allegations of Paragraph 5 of plaintiff's petition, to wit:

'5. At all times hereinafter mentioned defendant company was the owner of a 1966 XL Ford Sedan which was furnished by it for the benefit, use, and enjoyment of the family of John M. McIntosh, President of said corporation. At all times described herein, said Ford sedan was being used by Neff McIntosh, son of John M. McIntosh, with the knowledge, consent and approval of Mr. McIntosh and with the knowledge, consent, and approval of said corporation of which Mr. McIntosh is an officer and agent.' (Emphasis supplied).

The admission of the above paragraph is made in the answer filed by both defendants on April 10, 1970 paragraph 5 of which is:

'Defendants admit the allegations contained in paragraph five of plaintiff's complaint.'

On September 23, 1970, the above answer was voluntarily dismissed, and while the admissions above made could not thereafter be used as 'solemn admissions in judicio' against the defendants, they remained 'admissions' for whatever credit and value the jury might place upon same. See McConnell v. Gregory, 146 Ga. 475(1), 91 S.E. 550:...