In this revealing article, Christopher T. McGrath, Esq. explains how New York State’s highest court tackles the issue of vicarious liability, a legal doctrine that holds one party responsible for the negligence of a second party, in the context of businesses and motor vehicle accidents.
In an earlier article, I explained how a business that hires a driver sometimes becomes vicariously responsible, along with the driver’s “general employer,” for the driver’s negligence. I now provide two illustrations drawn from two decisions from New York’s highest court, known as the Court of Appeals. Each decision dealt with the situation in which a short-handed transportation company “borrows” (leases) a vehicle and driver from a competitor.
In Wagner v. Motor Truck Renting Corporation, 234 N.Y. 31 (1922), an entity known as Rodgers & Hagerty [hereinafter “Rodgers”] had a contract requiring it to perform certain excavation work. As part of the job, Rodgers “was required to remove the dirt excavated to dumps some 30 blocks away” (234 N.Y. at 33). Rodgers hired Hagerty Trucking Motor Company [“Hagerty”], a trucking company, to supply the needed trucks and drivers at an agreed price of $30 per truck per day. Id.
Although Hagerty had contracted to supply Rodgers’ trucking needs, Hagerty itself did not have enough trucks to do so. It thus “became necessary for the [Hagerty] Motor Trucking Company itself to obtain trucks from others” (234 N.Y. at 34). Some of those trucks, including the one involved in the subject accident, came from a trucking company called Motor Truck Renting Corporation [“Motor Truck”] (id.).
It was undisputed that the Motor Truck truckers, including the driver of the truck in issue, were “in the general employment of the latter corporation [Motor Truck]” (234 N.Y. at 34). The issue was whether the driver was also in the special employ of Hagerty, the trucking company that had agreed to provide the needed number of trucks (and drivers) but had then found it necessary to hire outside trucks from other trucking companies. The Court of Appeals’ unanimous answer was that such was an issue of fact for the jury to resolve.
The same conclusion was reached, but on slightly different analytic grounds, in Schmedes v. Deffaa, supra, 214 N.Y. 675 (1915), rev’g on the dissenting opinion below, 153 App.Div. 819, 138 N.Y.S. 931 (1st Dep’t 1912).
In Schmedes, an undertaker needed some carriages (together with horses and drivers). The undertaker contracted with Deffaa, who owned a livery stable, to provide same. However, Deffaa “had not sufficient carriages of his own to fill the order, and he thereupon applied to another livery stable keeper, named Naughton, for an additional carriage. Naughton sent one of his drivers, with a carriage and horses, with orders to report to defendant [Deffaa] and take his orders” (153 App.Div. at 820, 138 N.Y.S. at 932). Upon arrival at the undertaker’s funeral home, the driver was sent over to the location of the funeral. The subject accident occurred “while the carriage was on one of the East River bridges on the way to the cemetery …” (id.).
It was undisputed that the driver was in the general employ of Naughton, the stable owner who owned the subject carriage. The Appellate Division split 3 to 2 on whether Deffaa could be held responsible under the borrowed servant rule. The majority ruled in the negative. As they saw it, Deffaa was “merely … a middleman in the transaction” and “was neither the master of the driver, nor the one who directed his movements after he had reported to the undertaker” (153 App.Div. at 821, 138 N.Y.S. at 933).
The two Appellate Division dissenters saw the case differently. The dissenters contrasted two different situations. One hypothetical case was the case in which the hirer, lacking sufficient workers of its own, enters into an agreement with another such that the other “furnishes him with men to do the work, and places them under his exclusive control in the performance of it …” (153 App.Div. at 823, 138 N.Y.S. at 935). In this instance, the men provided “become pro hac vice the servants of him to whom they are furnished” (id.). The contrasting case was that in which the hirer, lacking sufficient workers of its own, hirers another to “perform the work through servants of his own selection, retaining the direction and control of them” (id.). The distinction, in other words, was whether the driver’s general employer was placing the driver and vehicle at the hirer’s disposal for an agreed price per day or whether the general employer was instead contracting to complete some assigned task for a given price. Because the case in issue fell into the first category, the dissenters held that the hirer could be deemed responsible in tort.
Based on the two dissents, the Schmedes case went up to the Court of Appeals. The Court of Appeals reversed unanimously, and it did do on the above-quoted dissenting opinion at the Appellate Division. The above-quoted Appellate Division dissent thus became, by adoption, a unanimous Court of Appeals holding.
New York car accident lawyers should know: a negligent driver sometimes has two (2) different employers who should be sued. If you are injured in a collision with a truck or car, after getting the medical care and treatment you need, you should consult with an attorney experienced in handling motor vehicle accident cases. Make sure that the attorney you hire is knowledgeable about the concept of vicarious liability. Your attorney should also be prepared to conduct the type of investigation that may be needed to uncover the different parties responsible for the accident.