Throop v. F. E. Young & Co.

• Decision Date: 05 June 1963
• Docket Number: No. 6852,6852
• Citation: 382 P.2d 560,94 Ariz. 146
• Parties: Mrs. Marie D. THROOP, a widow, for the benefit of herself and her minor children, Appellant, v. F. E. YOUNG AND COMPANY, a corporation, Appellee. Robert D. STAUFFER, as administrator of the Estate of Peter J. Hennen, deceased, Appellant, v. Mrs. Marie D. THROOP, a widow, for the benefit of herself and her minor children, Appellee.
• Court: Arizona Supreme Court

Page 560

382 P.2d 560

94 Ariz. 146

Mrs. Marie D. THROOP, a widow, for the benefit of herself and her minor children, Appellant, v. F. E. YOUNG AND COMPANY, a corporation, Appellee.

Robert D. STAUFFER, as administrator of the Estate of Peter J. Hennen, deceased, Appellant, v. Mrs. Marie D. THROOP, a widow, for the benefit of herself and her minor children, Appellee.

No. 6852.

Supreme Court of Arizona, In Banc.

June 5, 1963.

Udall & Udall, Tucson, for appellant, Mrs. Marie D. Throop.

Cavanagh & O'Connor, Phoenix, for appellee, F. E. Young & Co.

Moore & Romley, Phoenix, for appellant, Robert D. Stauffer.

WARREN L. McCARTHY, Superior Court Judge.

The plaintiff, Mrs. Marie D. Throop, a widow, brought a wrongful death action for the benefit of herself and her minor children, against defendants Robert D. Stauffer, as administrator of the estate of Peter J. Hennen, deceased, and the F. E. Young and Company.

Vernon Throop, husband of the plaintiff, Marie Throop, was a counter-intelligence officer of the United States Army working out of Tucson, Arizona. On October 10, 1957, Throop, with a passenger, was driving west towards Tucson on U. S. Highway 80 near Benson. On a level and straight highway in broad daylight the vehicle occupied by Peter Hennen, proceeding in an easterly direction, suddenly swerved into Throop's lane of traffic causing a violent head-on collision. Both Throop and Hennen were found dead in their cars by witnesses to the accident.

At the conclusion of the evidence, both defendants moved for a directed verdict. The court directed a verdict for the defendant F. E. Young and Company and denied the motion of Robert D. Stauffer, as administrator. The jury returned a verdict for plaintiff in the sum of $50,400.00 against the administrator.

Plaintiff has appealed from the directed verdict in favor of the F. E. Young and Company, and the defendant Stauffer, as administrator of the estate of Hennen, has appealed from the verdict in favor of plaintiff.

We will first consider the appeal of the plaintiff which is set forth in three assignments of error. The first two complain that the trial court erred in directing a verdict in favor of the defendant F. E. Young and Company. Consequently we must view the evidence in the light most favorable to the plaintiff, against whom judgment was rendered, and from that evidence, and the inferences reasonably and justifiably to be drawn therefrom, determine whether, under the law, the verdict for defendant can be sustained. In re Stitt's Estate, 93 Ariz. 302, 380 P.2d 601.

Plaintiff's first assignment of error is that there was sufficient evidence from which the jury could have found that the defendant controlled or had the right to control the actions of its deceased salesman.

The uncontradicted evidence of Hennen's employment by F. E. Young and Company showed that Violet Jennings, 48, a widow, was president of the Company which caused to be manufactured various medical testing kits and sold them to wholesalers throughout the country. The company employed the services of only two office employees other than the services of Peter J. Hennen. Hennen had been with the company 15 years and during the lifetime of William Jennings (deceased husband of Violet Jennings), a letter was drawn up by Mr. Jennings outlining the terms of the contract between the company and Hennen. Mrs. Jennings testified that the manner in which Mr. Hennen performed the services for the company was that he would come to the company office from time to time, pull cards on wholesale houses, and pick out the ones he desired to visit; or, if one of the two office employees would make a list of wholesalers for Hennen to visit, he would modify the list as he saw fit. He took care of his own hotel and traveling expenses out of his commissions; 1 1/4 cents per mile was paid on his automobile which he owned. He had no power to fix prices but he often gave more discounts than were on the discount cards furnished wholesalers and the company accepted these. At times he wrote the company so that he could get his mileage checks sent to him and also to let his family know where he was. He arranged his selling visits in accordance with the times he wished to visit relatives in various parts of the country and stayed with his relatives for varying periods of time as he desired. Hennen sold the goods of at least one other company while on his trips, in particular, novelty glass vases and paper weights for the St. Clair Glass Works. The amount of his commissions with the defendant company never exceeded $1,200 in any one year as Hennen was receiving social security and did not wish to jeopardize this status. The company made deductions from payments to Hennen for federal withholding tax and paid federal employment compensation. He was carried the same way on personnel records as the two office employees. Hennen visited the office an average of only four or five times a year.

The company had no program of physical examinations for its employees. Just prior to the trip during which this accident occurred, Hennen told Mrs. Jennings that he had had a physical examination and that his doctor had given him a clean bill of health. To Mrs. Jennings he appeared to be a robust man, gave the impression of having the best of health and never complained at any time of being ill. The fact that Hennen suffered from a heart condition was unknown to Mrs. Jennings. The matter of the heart condition will be referred to later in more detail.

The test to determine if the doctrine of 'respondeat superior' applies to charge an employer with liability for negligence of his employee is whether, with respect to the physical conduct of the employee and the performance of his service, he is subject to the employer's control or right of control. This principle is stated in Restatement of the Law, Agency 2d, § 220 in part as follows:

' § 220. Definition of Servant

'(1) A servant is a person employed to perform services in the affairs of another and who with respect to the physical conduct in the performance of the services is subject to the other's control or right to control.

'(2) In determining whether one acting for another is a servant or an independent contractor, the following matters of fact, among others, are considered:

'(a) the extent of control which, by the agreement, the master may exercise over the details of the work;

'(b) whether or not the one employed is engaged in a distinct occupation or business;

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'(e) whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work;

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'(g) the method of payment, whether by the time or by the job; * * *.'

The foregoing test has been approved and followed in Arizona in the cases of Consolidated Motors, Inc. v. Ketcham, 49 Ariz. 295, 66 P.2d 246, and Lee Moor Contracting Co. v. Blanton, 49 Ariz. 130, 65 P.2d 35.

The following discussion from the Consolidated Motors case is controlling in the instant case:

'But the ultimate fact, which these evidentiary facts are merely intended to assist the jury or court in determining, is whether the alleged servant is subject to the other's control or right to control in the manner in which he reaches the desired result. The distinction is well set forth as follows:

"It is important to distinguish between a servant and an agent who is not a servant, since ordinarily a principal is not liable for the incidental acts of negligence in the performance of duties committed by an agent who is not a servant (see § 250). One who is employed to make contracts may, however, be a servant. Thus, a shop girl or a traveling salesman may be a servant and cause the employer to be liable for negligent injuries to a customer or for negligent driving while traveling to visit prospective customers. The important distinction is between service in which the actor's physical activities and his time are surrendered to the control of the master, and service under an agreement to accomplish results or to use care and skill in accomplishing results. Those rendering service but retaining control over the manner of doing it are not servants. They may be agents, agreeing only to use care and skill to accomplish a result and subject to the fiduciary duties of loyalty and obedience to the wishes of the principal; or they may be persons employed to accomplish or to use care to accomplish physical results, without fiduciary obligations, as where a contractor is paid to build a house. An agent who is not subject to control as to the manner in which he performs the acts that constitute the execution of his agency is in a similar relation to the principal as to such conduct as one who agrees only to accomplish mere physical results. For the purpose of determining liability, they are both 'independent contractors' and do not cause the person for whom the enterprise is under-taken to be responsible, under the rule stated in § 219."

It is plaintiff's position that under Restatement of the Law, Agency 2d, § 220(2), there was sufficient evidence to raise an inference of a master-servant relationship that should have been submitted to the jury.

Plaintiff contends that by virtue of the contract signed by Hennen and Mr. Jennings prior to his death, at least seven years before the accident, Mr. Hennen was clearly a servant and not an independent contractor by reason of the mandatory provisions of the contract. This contract provided that Hennen was to do the following: 'You are to call on accounts or prospects in person and not by telephone. You are to present all items that we sell to each dealer. You are to submit a written report on each prospect called on, giving reasons where an order is not obtained for each item.' The letter further provided that Hennen would make collections, pick up stock from customers, put out display cards to dealers and perform other duties. This letter...