Tuesday, September 17, 2013

Court of Appeal: Employer Liable for Employee's "Off Duty" Car Accident

Here are the facts as told by the Court of Appeal:
An employee of an insurance broker was required each workday to drive to and from the office in her personal vehicle. During the workday, the employee had to use her vehicle to visit prospective clients, make presentations, provide educational seminars, follow leads, and transport company materials and coemployees to work-related destinations.

On April 15, 2010, the employee left the office at the end of the workday and began driving in the direction of her home. She had decided that, on the way, she would stop for some frozen yogurt and take a yoga class. As the employee made a left turn at the yogurt shop, she collided with a motorcyclist.

Motorcyclist sues driver of course. But motorcyclist also sues the employer.  Employer moves the trial court for summary judgment and wins.  After all, she's commuting and then she did not go home, but rather for a snack and some exercise. So, her accident is her responsibility.  End of post, right?

Nope.  Here's how the court summarized its lengthy decision:

Because the employer required the employee to use her personal vehicle to travel to and from the office and make other work-related trips during the day, the employee was acting within the scope of her employment when she was commuting to and from work. The planned stops for frozen yogurt and a yoga class on the way home did not change the incidental benefit to the employer of having the employee use her personal vehicle to travel to and from the office and other destinations. On the day of the accident, the employee had used her vehicle to transport herself and some coemployees to an employer-sponsored program, and the employee had planned to use her vehicle the next day to drive to a prospective client‘s place of business. Nor did the planned stops constitute an unforeseeable, substantial departure from the employee‘s commute. Rather, they were a foreseeable, minor deviation. Finally, the planned stops were not so unusual or startling that it would be unfair to include the resulting loss among the other costs of the employer‘s business. Thus, under the required vehicle exception to the going and coming rule, the employee was acting within the scope of her employment at the time of the accident, and the doctrine of respondeat superior applies. Accordingly, the trial court erred in granting the employer‘s summary judgment motion
Here's how it breaks down:

1. The doctrine of "respondeat superior" requires an employer to answer for the torts of the employee, if those torts are committed within the "scope of employment."  This is also called "vicarious" liability.  Good so far?

2.  Under the "going and coming" rule, employers are not liable for the torts of employees committed during the regular commute to and from work / home.  Right, so that's why the employer should have  won! Not so fast, grasshopper.

3.  The "required vehicle exception" to the going and coming rule means that when an employer requires an employee to use a personal vehicle as part of her duties, the "going and coming rule" does not apply, and accidents that occur on the way to or from work may be the employer's responsibility.  In this case, the court held that the "required vehicle" exception applied because the employer required the employee to use her personal car for work-related trips, including on the day she had the accident.

4.  Even under the required vehicle exception, the employer is not liable for everything that an employee does in her personal vehicle.  The employer may not be liable if the employee's side trip is not "foreseeable."  But not "foreseeable" is way more than just a short side-trip for yogurt and yoga.   It is "foreseeable," the court noted, that employees using their own cars would do personal errands for their own comfort and convenience.  Had she visited a friend in another town, committed an intentional act or a crime, I believe this would have come down a different way.

5.  If driving is not part of the job, or if the employer does not require employees to use their cars as part of their jobs, then the going and coming rule still applies and there is no liability for accidents that occur during the commute.  In this case, the employee used her personal car two to five times a week for work-related business. How much work-related driving is enough to trigger the required vehicle exception?  There will be litigation. 

The court went over several different prior decisions and provided detailed analysis.  So, if you would like to know how courts draw the line, you can read the full opinion at the link below.

This decision is an important reminder that employers who require employees to use their personal cars for business will take on additional liabilities.  Therefore, employers imposing such requirements should ensure employees are properly licensed and ensure business insurance is sufficient to cover these types of accidents.  

Employers thinking of imposing restrictions on employees' activities during the "going and coming" to minimize liability for traffic accidents could cause a wage-hour problem.  So, as WW says, "tread lightly" or get some advice first.

The opinion in Moradi v. Marsh USA is here.