Whitehead v. Variable Annuity Life Ins. Co., 19645

• Decision Date: 02 February 1989
• Docket Number: No. 19645,19645
• Parties: Stephen WHITEHEAD and Deborah Whitehead, Plaintiffs and Appellees, v. VARIABLE ANNUITY LIFE INSURANCE COMPANY, Larry Anderson, American Motor Sales Corporation and Jeep Corporation, Defendants and Appellants.
• Court: Utah Supreme Court

Page 934

801 P.2d 934

Stephen WHITEHEAD and Deborah Whitehead, Plaintiffs and Appellees, v. VARIABLE ANNUITY LIFE INSURANCE COMPANY, Larry Anderson,

American Motor Sales Corporation and Jeep

Corporation, Defendants and Appellants.

No. 19645.

Supreme Court of Utah.

Feb. 2, 1989.

Raymond M. Berry, Pamela G. Heffernan, Salt Lake City, for defendants and appellants.

Jackson Howard, Richard B. Johnson, Provo, for plaintiffs and appellees.

HOWE, Associate Chief Justice:

Defendant Variable Annuity Life Insurance Co. (VALIC) appeals from a directed verdict holding it liable as a matter of law for the negligence of its employee, Larry Anderson.

Anderson served as a district manager/salesman for VALIC. His duties included supervising salesmen and marketing annuities. VALIC furnished him with an office in Salt Lake City, complete with telephone, telex, and a full-time secretary/office manager. He usually arrived at his office between 9 and 10 a.m. and left for the day around 5 p.m. He used his own car to commute to and from work and for sales calls during the day. He was reimbursed for business mileage, but not for commuting between his home in Provo and his office. In addition to his office work, he occasionally made sales calls on his way home and made phone calls to clients from his home.

On the evening of October 16, 1979, Anderson left his office around 5 p.m. to return home. He testified at trial that he intended to make some work-related phone calls after dinner. He had no appointments between Salt Lake City and Provo that evening or the following day. On his way home, Anderson's station wagon struck the rear of plaintiffs' vehicle. Plaintiffs' vehicle went out of control and rolled, seriously injuring plaintiff Stephen Whitehead.

At trial, a jury found Anderson negligent in causing the accident. He was held liable for 30 percent of the 1.6 million dollar award of damages. ¹ Plaintiffs, Anderson, and VALIC all moved for a directed verdict on the issue of vicarious liability. The judge denied VALIC's motion, and the issue was sent to a jury, which found that Anderson was not using his vehicle for the benefit of his employer at the time of the accident. The trial court nevertheless granted plaintiffs' and Anderson's motions for a directed verdict that, as a matter of law, Anderson was in the scope of his employment at the time of the accident. VALIC was held vicariously liable. It appeals, assailing the directed verdict.

In order to hold an employer vicariously liable for the negligent acts of its employee, the employee's acts must be committed in the course and scope of his employment. Gleason v. Salt Lake City, 94 Utah 1, 74 P.2d 1225 (1937); see generally 53 Am.Jur.2d Master and Servant §§ 417, 427 (1970). As a general rule, an employee is not acting within the course and scope of his employment when he is traveling in his own automobile to and from work. Cherne Construction v. Posso, 735 P.2d 384 (Utah 1987); Soldier Creek Coal v. Bailey, 709 P.2d 1165 (Utah 1985); Barney v. Industrial Commission, 29 Utah 2d 179, 506 P.2d 1271 (1973).

This general rule has been applied by this Court in workers' compensation cases. Posso; Soldier Creek Coal; Barney v. Industrial Commission; Lundberg v. Cream O'Weber/Fed. Dairy Farms, Inc., 24 Utah 2d 16, 465 P.2d 175 (1970). However the principle is not limited to workers' compensation; other jurisdictions have also applied the so-called "coming and going rule" under facts similar to the instant case to deny third-party negligence claims.

In Heide v. T.C.I., 264 Or. 535, 506 P.2d 486 (1973), the Oregon Supreme Court held that the employer should have been granted a directed verdict on the issue of vicarious liability where the accident occurred on the employee's way home from work. The employee there, as in the instant case, used her own car for business. She was reimbursed for business mileage, but not for commuting to and from work. She had business literature in the car and frequently worked at home after hours and on weekends. The court ruled, as a matter of law, that she was not acting to benefit her employer and her employer had no control over her at the time of the accident.

Likewise, in Wills v. Correge, 148 So.2d 822 (La.Ct.App.1963), a salesman who used his own car to make sales calls had concluded his business for the day and was on his way home when his station wagon struck and injured a child. The court applied the general rule that "an employee, in going to and from his place of employment, is not considered as acting within the scope of his employment to such an extent as to render his employer liable to third persons for the employee's negligent acts." Id. at 824 (citations omitted). The court relied on the fact that the employee was not under the employer's control, nor was the employee's trip home at the time of the accident taken "to benefit or serve the employer or his business to the extent that the employer can be held responsible under the doctrine of respondeat superior." Id. at 825.

In Coates v. Murphy, 270 A.2d 527 (Del.1970), the defendant, Murphy, was a salesman who used his own car to call on customers. He would report to the office in the morning and then call in from time to time during the day to learn what other visits he was to make. While on his way home to have lunch with his wife, he was involved in an automobile accident that took the life of the plaintiff's decedent. The Delaware Supreme Court found that Murphy was not in the scope of his employment, even though he planned to call his office to receive instructions for the remainder of the day when he arrived home. The court reasoned that "no purpose of the employer was served by Murphy's trip" since the planned telephone call could have been made anywhere and was merely incidental to his purpose in going home to have lunch.

Having previously adopted the "coming and going rule" in workers' compensation cases, we here extend that principle to cases involving third-party negligence actions and hold that generally an employee is not in the scope of his employment for purposes of third-party negligence claims when he is traveling to and from work.

Plaintiffs contend that even if the general rule is applicable to third-party negligence claims generally, it should not apply in this case. They claim that Anderson's conduct falls outside the rule since he made sales calls at various locations and times in addition to his office work. They rely on Moeller v. De Rose, 222 P.2d 107 (Cal.Dist.Ct.App.1950), where the California court declined to apply the general rule to a rural deliveryman, stating: "That rule is applicable where the employee is required to perform services at a fixed place on particular premises...." Id. at 114. The main question in De Rose was whether the defendant was an employee or an independent contractor. De Rose was a rural deliveryman who was involved in an accident while completing his rounds making collections....