Sipple v. Starr

• Decision Date: 15 July 1999
• Docket Number: No. 25798.,25798.
• Citation: 520 S.E.2d 884,205 W.Va. 717
• Court: West Virginia Supreme Court
• Parties: Debbie SIPPLE, as Administratrix of the Estate of Sidney Ward Sipple, Deceased, and Debbie Sipple, Individually, Plaintiff Below, Appellant, v. David STARR, Individually, and dba Rocket Mart, Inc., a West Virginia Corporation, and Petroleum Products, Inc., a Corporation, Defendants Below, Appellees.

520 S.E.2d 884

205 W.Va. 717

Debbie SIPPLE, as Administratrix of the Estate of Sidney Ward Sipple, Deceased, and Debbie Sipple, Individually, Plaintiff Below, Appellant, v. David STARR, Individually, and dba Rocket Mart, Inc., a West Virginia Corporation, and Petroleum Products, Inc., a Corporation, Defendants Below, Appellees.

No. 25798.

Supreme Court of Appeals of West Virginia.

Submitted May 4, 1999.

Decided July 15, 1999.

Dissenting Opinion of Justice Davis July 20, 1999.

Stephen B. Farmer, Esquire, Philip J. Combs, Esquire, Farmer, Cline & Arnold, Charleston, West Virginia, W. Thomas Ward, Esquire, Ward & Associates, Williamson, West Virginia, Attorneys for Appellant.

Ancil G. Ramey, Esquire, Steptoe & Johnson, Charleston, West Virginia, Attorney for Appellees David Starr and Rocket Mart, Inc.

Charles M. Love, Esquire, Stuart A. McMillan, Esquire, Bowles Rice McDavid Graff & Love, Charleston, West Virginia, Attorneys for Appellee Petroleum Products, Inc. McGRAW, Justice:

Appellant Debbie Sipple, administratrix for her son Sidney Sipple, appeals a grant of summary judgment for appellee, fuel distributor Petroleum Products Inc., in her wrongful death action, in which she sought damages for the death of her son, killed when visiting a convenience store in Mingo County known as the Rocket Mart. The Circuit Court of Mingo County granted summary judgment on the basis that appellee had no control over the operation of the store, was not liable for negligent selection of the store for distribution of its gasoline, and was not engaged in a joint venture with the store or its owner. Because we find that genuine issues of material fact do exist with regard to these allegations, we reverse.

I. FACTUAL BACKGROUND

At the time of the events giving rise to this case, the Rocket Mart was a branded Chevron gas station and convenience store located near the Mingo County community of Red Jacket. Defendant below, David Starr, owned the Rocket Mart, and did business as Rocket Mart, Incorporated, an entity he owned in its entirety. Appellee and defendant below Petroleum Products, Inc. (hereinafter "PPI") sold Chevron gasoline ¹ throughout southern West Virginia, through its own stores, or through other stores, such as the Rocket Mart.

PPI and Starr entered into an agreement whereby Starr would sell PPI gasoline to Rocket Mart customers. Starr owned the underground tanks; PPI provided, and retained ownership of, the gasoline pumps and associated equipment located upon the Rocket Mart property. PPI also retained ownership of all gasoline in the tanks until a customer purchased the gasoline. PPI paid Starr seven cents for each gallon sold.

Unlike most stores of its kind, the Rocket Mart was a full service establishment in that, in addition to the usual gasoline and groceries available at all such stores, it also contained what could be characterized as a bar area, where customers could purchase beverages containing alcohol (albeit legally defined as nonintoxicating)² for consumption on the premises, and could even enjoy a game of pool while doing so. The cashier at the Rocket Mart wore two hats, acting as both cashier and attendant for the gas and grocery operation, and as bar keep for the sale of legal beverages consumed on the premises. Evidence in the record suggests that the tap for the draft beer was located next to the register, and that customers, should their credit history permit, could use a Chevron credit card to purchase a "cold one."

Luther Fields, II, worked at the Rocket Mart as a cashier. Starr kept a loaded gun near the cash register, and deposition testimony indicates that Fields had, on occasion, displayed the gun to customers of the store. Testimony also suggests that, on at least one occasion, Starr himself had taken this gun and exchanged fire outside the Rocket Mart with parties unknown.

Sidney Sipple³ was present at the Rocket Mart on July 9, 1992, as he had been on many previous occasions. Sipple was an acquaintance of Fields, who was working that day as the cashier qua bartender of the Rocket Mart. During his visit to the store, Sipple engaged in horseplay with Fields. For reasons not entirely clear, Fields shot and killed Sipple with the aforementioned gun. Fields later plead guilty to manslaughter. On June 17, 1993, Debbie Sipple commenced the action giving rise to this appeal.

Initially, Ms. Sipple sued only Rocket Mart, Inc. In February of 1994, she filed an amended complaint alleging a separate cause of action against Starr, and sought to pierce the corporate veil. During the discovery process, Ms. Sipple learned of the relationship between PPI and Starr, and she filed in June of 1994 a second amended complaint to include claims against Starr, Rocket Mart, Inc., and PPI. Ms. Sipple alleged, inter alia, that the defendants were liable for Fields' actions under theories of vicarious liability and respondeat superior. PPI moved for summary judgment, which the lower court granted, on the basis that PPI did not exercise sufficient control over the operation of the Rocket Mart to render it liable for the death of Sipple.⁴

In so doing, the lower court found that Ms. Sipple had presented no genuine issue of material fact as to whether PPI exercised control over Starr and the Rocket Mart, whether PPI negligently retained or selected Starr and the Rocket Mart to distribute its gasoline, and whether all defendants below were engaged in a joint venture. We believe that appellant did raise issues of fact on each of these allegations sufficient to render inappropriate the circuit court's grant of summary judgment. Accordingly, we reverse.

II. STANDARD OF REVIEW

Summary judgment is granted appropriately in limited circumstances: "A motion for summary judgment should be granted only when it is clear that there is no genuine issue of fact to be tried and inquiry concerning the facts is not desirable to clarify the application of the law." Syl. pt. 3, Aetna Casualty & Sur. Co. v. Federal Ins. Co. of New York, 148 W.Va. 160, 133 S.E.2d 770 (1963). We have elaborated upon this holding by explaining:

Roughly stated, a "genuine issue" for purposes of West Virginia Rule of Civil Procedure 56(c) is simply one half of a trialworthy issue, and a genuine issue does not arise unless there is sufficient evidence favoring the non-moving party for a reasonable jury to return a verdict for that party. The opposing half of a trialworthy issue is present where the non-moving party can point to one or more disputed "material" facts. A material fact is one that has the capacity to sway the outcome of the litigation under the applicable law.

Syl. pt. 5, Jividen v. Law, 194 W.Va. 705, 461 S.E.2d 451 (1995).

III. DISCUSSION

A. Control

PPI argues that Starr, doing business as Rocket Mart, was an "independent dealer" who, under the terms of their various agreements had "entire charge and control of the management of [PPI's] business for the purposes of accomplishment of [the sale of gasoline]." PPI properly identifies in its brief the importance of control⁵ in any action involving an allegation of respondeat superior liability:

If the right to control or supervise the work in question is retained by the person for whom the work is being done, the person doing the work is an employee and not an independent contractor, and the determining factor in connection with this matter is not the use of such right of control or supervision but the existence thereof in the person for whom the work is being done.

Syl. pt. 2, Spencer v. Travelers Insurance Company, 148 W.Va. 111, 133 S.E.2d 735 (1963). Accord, Farmers & Mechanics Mut. Ins. Co. v. Casey, 201 W.Va. 418, 497 S.E.2d 771 (1997)(per curiam)

.

The frequent, and often baseless, invocation of the independent contractor defense has eroded the confidence of courts in its applicability. Like the child who always places blame for an accident on a sibling or imaginary friend, the defendant employing the independent contractor defense must combat the reasonable cynicism of his audience:

The defense of "independent contractor" is one which defendants have long favored as a means of denying liability for acts which are done by those whom they neither control nor have a right to control. However, over the years, the defense has proved to be a slender reed and one which the courts have found difficult to apply.

Sanders v. Georgia-Pacific Corp., 159 W.Va. 621, 625, 225 S.E.2d 218, 221 (1976) (footnote omitted). It is quite natural that a business entity would employ what it deems to be an "independent contractor" in an effort to limit its exposure to damages as much as possible; a business entity naturally will do everything legal to externalize its costs while increasing its profits. But society also has an interest in seeing that the costs of a particular activity are borne by those who profit from that activity.⁶

A danger inherent in the broad application of the independent contractor defense is that it often encourages large, solvent companies (which usually have superior technical expertise, better trained employees, more reliable equipment, and greater resources to compensate injured parties) to employ to carry out their work much smaller companies or individuals (which often have less knowledge, less experienced employees, less reliable equipment and little or no financial resources).⁷ The result may be many uncompensated injuries and enormous defaults on unemployment insurance premiums, workers' compensation premiums, taxes, pension obligations, and uncorrected environmental damage. See, e.g., Connors v. Paybra Mining Co., 807 F.Supp. 1242 (S.D.W.Va.1992)

.

We have previously noted that:

"So riddled is the rule insulating a general contractor from an independent contractor's negligence that one court has aptly noted: `Indeed it would be proper to say that the rule is now primarily important as a preamble to the catalog of its exceptions.' "(Citing in Footnote 3:

...