Williams v. Rene

Opinions of the United
1995 Decisions States Court of Appeals
for the Third Circuit

11-15-1995

Williams v Rene
Precedential or Non-Precedential:

Docket 95-7226

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Recommended Citation
"Williams v Rene" (1995). 1995 Decisions. Paper 289.
http://digitalcommons.law.villanova.edu/thirdcircuit_1995/289

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 UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
____________

No. 95-7226
____________

ANTONIO WILLIAMS

V.

JOSEPH RENE; ESSO VIRGIN ISLANDS, INC.

Scott Drake; John Doe,
Third-party Defendants

Esso Virgin Islands, Inc., Appellant
____________

APPEAL FROM THE DISTRICT COURT OF THE VIRGIN ISLANDS
Division of St. Croix
(D.C. No. 91-cv-00231)
____________

Argued August 16, 1995

Before: STAPLETON, LEWIS and WEIS, Circuit Judges

Filed November 15, l995
____________

Robert T. Lehman, Esquire (ARGUED)
Arthur H. Jones, Jr., Esquire
Archer & Greiner
A Professional Corporation
One Centennial Square
Haddonfield, New Jersey 08033

Douglas L. Capdeville, Esquire
2107 Company Street, Lot #4
Christiansted, St. Croix
U.S.A. Virgin Islands 00820-4918

Attorneys for Appellant

Lee J. Rohn, Esquire (ARGUED)
Maurice J. Cusick, Esquire
Rohn & Cusick
1101 King Street

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Christiansted, St. Croix
U.S.A. Virgin Islands 00820

Linda Morgan, Esquire
P.O. Box 3530
Christiansted, St. Croix
U.S.A. Virgin Islands 00820

Renee D. Dowling, Esquire
P.O. Box 1047
Christiansted, St. Croix
U.S.A. Virgin Islands 00821

Attorneys for Appellee

WEIS, Circuit Judge.
In this Virgin Islands automobile accident case,

evidence that an employee was driving a company car for his own

convenience, together with a presumption of vicarious liability

on the part of the employer, raised a question for the jury to

resolve. Because the trial court granted a partial judgment as a

matter of law against the employer on the respondeat superior

issue, we will reverse and remand for a new trial.

For guidance on the retrial, we note that an

unsupported opinion by an actuarial expert on the plaintiff's
future earnings should not be received into evidence. We also

conclude that the failure of defense counsel to advise the

plaintiff's lawyer of an interview with an attending physician is

not an adequate ground to exclude that doctor's testimony.

Plaintiff Antonio Williams was injured on St. Croix,

Virgin Islands on December 12, 1990 when his pickup truck

collided with an automobile owned by defendant Esso and operated

by Joseph Rene, one of its employees. Williams sued both Esso

2
and Rene in the District Court of the Virgin Islands. At the

conclusion of the evidence at the trial, on the plaintiff's

motion, the court dismissed Rene from the case. The jury then

awarded plaintiff a verdict of $4.5 million against Esso. The

district court denied Esso's post-trial motions. Williams v.

Rene, 886 F. Supp. 1214 (D.V.I. 1995).

Esso had assigned the automobile in question to the

position held by one of its employees, Helen Sia. In carrying

out her duties as a sales representative, Sia traveled frequently

to visit various customers in the Virgin Islands. Esso permitted

her to take the company car home after work and to use it for

personal matters.

Sia's office was located about a quarter of a mile from

the St. Croix Airport Terminal and was separated from it by the

"Esso Yard." On some occasions, she would drive from her home to

the airport terminal to meet with customers. At other times, she

would travel directly from her residence to her office. If it

became necessary during the work day to go to the airport

terminal, Sia would either walk, drive the company car, or be

"shuttled" by another Esso employee who might be available.

On the evening of December 11, 1990, the day before the

accident, Sia drove the company car to her home with a passenger,

her co-employee Rene, whose own vehicle had broken down. When

they arrived at Sia's residence, she turned the car over to Rene,

who then drove it to his home, some distance away. The

understanding was that Rene would return the automobile to Sia at

her home the following morning. She would then drive to the

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airport for a business appointment there, dropping Rene off at

his job site.

Rene was a crew leader in the Esso group that refueled

planes at the St. Croix Airport. He was not Sia's supervisor nor

did she supervise him. No supervisory person authorized Rene to

drive the car on this occasion.

The accident occurred not long after Rene left his

home, between 6:45 a.m. and 7:00 a.m., and while he was en route

to Sia's home. The record does not disclose when Sia and Rene

were to report to work, but it may be assumed that the starting

times were after the hour at which the accident occurred.

At the close of the evidence, the trial court granted

the plaintiff's motion for a partial judgment as a matter of law,

holding Esso responsible under respondeat superior principles.

Plaintiff also moved to dismiss Rene as a defendant "conditioned

on the granting of the motion for respondeat superior and . . .

seek its damages solely from Esso as a result of its employee in

the course and scope of his employment." That motion was also

granted and the case went to the jury with Esso as the sole

defendant.

Defendant appealed, asserting that the district court

erred in granting judgment as a matter of law on the agency issue

and in failing to grant a remittitur or order a new trial because

of the excessiveness of the verdict.

I.

The plaintiff's theory of liability against Esso is

based on respondeat superior, that is, that an employer is

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responsible for the negligence of its employees that occurs

within the course and scope of their employment. The employer's

liability is vicarious and secondary to that of the employee,

which is primary. The relationship was explained in Builders

Supply Co. v. McCabe, 77 A.2d 368, 370 (Pa. 1951): "[T]he person

primarily liable is the employee or agent who committed the tort,

and the employer or principal may recover indemnity from him for

the damages which he [the employer] has been obliged to pay."

Accord Sochanski v. Sears, Roebuck & Co., 689 F.2d 45, 50 (3d

Cir. 1982); Tromza v. Tecumseh Prods. Co., 378 F.2d 601, 605 (3d

Cir. 1967). The Restatement (Second) of Agency is in agreement.

Section 401 comment (d) reads, "a servant who, while acting

within the scope of employment, negligently injures a third

person, although personally liable to such person, is also

subject to liability to the principal if the principal is thereby

required to pay damages." See also Restatement of Restitution

§ 96 (1937).

Throughout the litigation, the parties seemed to assume

that the liability of Esso and Rene was joint and several. This

misunderstanding of the fundamental nature of Rene's primary

responsibility led to a number of errors during the proceedings.

For example, in her opening remarks to the jury, the plaintiff's

counsel said ". . . if Mr. Rene was operating that vehicle in the

course and scope of his employment, then his employer is the one

who's responsible to pay the damages and that's Esso. And the

law says if Mr. Rene was not in the course and scope of his

employment, then Mr. Rene is liable for those damages."

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 These comments, of course, are a misstatement of the

law. Rene, as the primary tortfeasor, would be liable in any

event for his negligence in causing the accident without regard

to whether Esso was secondarily liable. Esso would be

responsible only if Rene were negligent and his conduct occurred

during the course and scope of his employment. Esso's liability

would be vicarious only, but Rene's conduct would be the sole,

active negligence that caused the accident.

We turn then to the scope of employment issue. Because

the Restatements furnish the guiding common law in the Virgin

Islands, we look to sections 228 and 229 of the Restatement

(Second) of Agency. V.I. Code Ann. tit. 1, § 4 (1967).

Restatement section 228(1)(a),(b) provides that conduct

of a servant is within the scope of employment if it is the kind

he is employed to perform and it occurs substantially within the

authorized time and space limits. Section 228(2) states that

conduct is not within the scope of employment if it is "too

little actuated by a purpose to serve the master."

Comment d to section 229 is particularly pertinent

here. It discusses the "going to and from work" situation and

notes the importance of ascertaining "whether the vehicle is

supplied primarily for the purpose of assisting the [employer's]

work, or for the purpose of assisting the employee to perform

what is essentially his own job of getting to . . . work." Simply

because the employer provides a vehicle "does not establish that

those who avail themselves of it are within the scope of

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employment while upon it, especially if the use is merely

casual." Id.

The general rule is that employees are not within the

scope of their employment while traveling to and returning from

work. That principle was recognized by the Territorial Court of

the Virgin Islands in McFarlane v. Jones Masonry, 25 V.I. 43

(Terr. Ct. 1990). See also Charles v. Mitchell, 21 V.I. 478

(D.V.I. 1985). There may be some circumstances that take a case

out of the general rule, for example, when there are express

instructions by the employer or when the trip serves some

specific purpose of the employer other than merely providing for

the presence of the employee at the work place. See, e.g.,

Caldwell v. A.R.B., Inc., 222 Cal. Rptr. 494, 498 (Cal. Ct. App.

1986).

In Pacheco v. United States, 409 F.2d 1234, 1237 (3d

Cir. 1969), we held that, generally speaking, proof of a

defendant's ownership of a vehicle and of its operation at the

time of the accident by an agent of the defendant creates a

presumption that the driver was acting within the scope of

employment. As we indicated in the opinion, that presumption is

rebuttable. Id.
Federal Rule of Evidence 302 provides that the effect

of a presumption is determined by state law whenever it supplies

the rule of decision on a claim. Assuming, without deciding,

that the Virgin Islands statute on presumptions, V.I. Code Ann.

tit. 5, § 812 (1967), governs here, Esso had the burden of

7
proving that Rene was not acting within the scope of his

employment once plaintiff established the Pacheco presumption.

The standard of review for the grant of a motion for

judgment as a matter of law varies according to whether the

moving party has the burden of proof. Fireman's Fund Ins. Co. v.

Videfreeze Corp., 540 F.2d 1171, 1177 (3d Cir. 1976). Because

Esso had the burden of proof on the respondeat superior issue,

the grant of the plaintiff's motion can be sustained "only if,

viewing the evidence in the light most favorable to the non-

moving party, there is no question of material fact for the jury,

and any verdict other than the one directed would be erroneous

under the governing law." Tait v. Armor Elevator Co., 958 F.2d

563, 569 (3d Cir. 1992) (quoting Macleary v. Hines, 817 F.2d

1081, 1083 (3d Cir. 1987)).

The record in this case contains ample evidence to

rebut a Pacheco presumption. Rene's employment at the airport

was not the type of job that required travel by automobile over

the Island. Rene left his home between 6:45 and 7:00 a.m. The

collision occurred shortly thereafter, apparently before he was

to report for work at the airport. At the time of the collision,

he was en route to Sia's home to turn the car over to her. Sia,

a co-employee, had furnished the car as a favor to Rene to get

him from her home to his and back. No one in a supervisory

position at Esso had authorized or directed Rene to use the car

on the day of the accident, or to pick up Sia.

Plaintiff produced some evidence that, at various times

in the past, some of Esso's employees had been authorized during

8
working hours to drive to employees' homes in order to bring them

to the work place. That testimony was general and did not

establish a clear policy, nor did it demonstrate that Rene had

been directed to bring Sia to work. In this context, it is

important to note, as the Restatement points out, the distinction

between an employer's permission to drive a company car for

personal errands and directions for the use of the automobile on

the employer's business. The mere fact that Esso had allowed its

employees to use its vehicles to bring other employees to work in

the past did not establish that Rene was within the scope of

employment.

Although plaintiff was entitled to a Pacheco

presumption, there was adequate evidence to support a finding

that Rene was using the automobile for his own personal

convenience and not on the business of Esso. Consequently, the

respondeat superior question should have been submitted to the

jury. It was error, therefore, to grant judgment against Esso on

the vicarious liability issue. Accordingly, a new trial must be

granted.

At this juncture, the question arises whether the new

trial should be granted only as to liability without vacating the

damage award. In Gasoline Prods. Co. v. Champlin Refining Co.,
283 U.S. 494 (1931), the Supreme Court held that even if error as

to one issue requires a new trial, it need not include other

separate points that were properly decided. If the issue of

damages, however, is so intertwined with liability that one

cannot be submitted to the jury independently of the other

9
without confusion and uncertainty, then a new trial must extend

to all issues. Id. at 500-01. Accord Simone v. Golden Nugget

Hotel & Casino, 844 F.2d 1031, 1040 (3d Cir. 1988); Vizzini v.

Ford Motor Co., 569 F.2d 754, 759 (3d Cir. 1977); see also Fed.

R. Civ. P. 59(a).

This appeal presents a unique circumstance that has a

bearing on the appropriate scope of a new trial. The district

court granted the plaintiff's request to dismiss defendant Rene

just before the case was submitted to the jury. The dismissal

was conditional, that is, dependent on a judgment as a matter of

law against Esso on the respondeat superior issue. The situation

thus created may fairly be said to come within the purview of a

comment in a leading treatise: "When fewer than all defendants

are dismissed voluntarily, . . . the court retains plenary power

to reinstate those defendants until the claim has been

adjudicated as to the remaining defendants." 9 Charles A. Wright

& Arthur R. Miller, Federal Practice and Procedure § 2367 at 323

(1995).

Because the respondeat superior ruling must be set

aside, so too must Rene's dismissal be vacated. The district

court acquiesced in the limited effect of the plaintiff's motion,

and it would be inappropriate, as well as unfair, to hold at this

point that Rene would no longer be a party. We therefore direct

that Rene be reinstated as a defendant.

Having concluded that Rene will be a party on the

retrial, we must consider what effect that factor will have on

the remaining issues. It is significant that the jury reached

10
its verdict on negligence and damages at a time when Rene was no

longer a defendant in the case. On retrial, it may be that the

jury will exonerate both Esso and Rene, or perhaps, leave Rene to

bear full responsibility for the plaintiff's damages. In view of

those possibilities, it would be inequitable to have Rene bound

by a negligence finding or a damages assessment that a jury might

not have rendered had it been aware that he was to be the sole,

primarily-responsible defendant.

We need not blind ourselves to the fact that juries are

apt to assess larger verdicts against major corporations than

against individuals. Indeed, the plaintiff's ploy in dismissing

Rene from the suit was clearly intended to focus the jury's

attention on the deep pocket defendant, Esso. In the

circumstances here, the new trial must extend to all parties and

to damages as well as liability.

II.

Because we have decided that a new trial must include

damages, we need not discuss at any length the defendant's

contention that the verdict was excessive. However, guidance on

some matters that may recur on the retrial may be helpful.

About a month and a half after the accident, plaintiff

returned to his job as a first class mechanic at the Virgin

Islands Water and Power Authority. He continued to work there

until shortly before the trial began. In early 1992, plaintiff

applied for, and received, a promotion to preventive maintenance

supervisory foreman, a position that paid approximately $44,000

per year. That was a substantial increase over the $30,000 he

11
received in 1991. His earnings in 1992 were approximately

$35,000, but the record does not disclose what part of that sum

included the higher pay for the supervisory position.

At trial, the plaintiff's actuarial expert, assuming

plaintiff would be permanently disabled, projected his gross loss

of income to be approximately $2 million. This calculation took

into account both anticipated earnings and projected inflation to

arrive at an annual increase of 5% over the plaintiff's current

earnings. The witness reduced the $2 million figure to its

present value of approximately $750,000.

In responding to a question from the plaintiff's

counsel on redirect examination, the expert said that, based on

actual earnings from 1991 through 1993, the average increase in

income was 16.1% annually, more than three times higher than the

5% figure that he had used in projecting the gross earnings loss.

Counsel then stated: "So instead of two million, you would have

a number of six million dollars, is that right?" The expert

replied, "Yes, ma'am, or close to it."

Two serious deficiencies undermine that testimony of

counsel and expert. There was no evidence on which the witness

could properly base an opinion that the plaintiff's gross

earnings would triple in the remaining seventeen years of his

service before retirement. The record contains no data on the

salary scales at the Water and Power Authority and nothing to

indicate that the plaintiff's experience and training would

qualify him for positions higher than the one he held at time of

trial. See Benjamin v. Peter's Farm Condominium Owners Ass'n,

12
820 F.2d 640, 642 (3d Cir. 1987) (requiring evidence to justify

prospective earnings); Gumbs v. International Harvester, Inc.,

718 F.2d 88, 98 (3d Cir. 1983) (same). The 16% average increase

primarily was the result of the warping of the earnings record

brought about by the substantial promotion from mechanic to

supervisory foreman. Moreover, at no time was the $6 million

projection reduced to present worth, an obligation that plaintiff

must shoulder. See Gorniak v. National R.R. Passenger Corp., 889

F.2d 481, 486 (3d Cir. 1989).

The $6 million figure apparently had an appreciable

influence on the size of the verdict. In his post-trial opinion

reviewing the damage award, the trial judge commented: "Plaintiff

presented evidence . . . that Mr. Williams' economic damages

alone might be estimated at almost 6 million dollars." Williams,

886 F.Supp. at 1239. "If the jury believed this testimony, then

the entire $4.5 million dollar award is actually lower than the

evidence revealed in the record of Mr. Williams' maximum economic

damages. If they believed this testimony, it is possible that

they came up with the $4.5 million award without even considering

any damages for pain and suffering. It is quite likely that the

jury did believe plaintiff's evidence since it was essentially

unrebutted by the defendants." Id. at 1241.1

1
Because he concluded that the loss of income made up such a
large part of the award, the trial judge did not deem it
necessary to review other cases involving similar injuries to
determine the reasonableness of amounts awarded for pain and
suffering. See Gumbs v. Pueblo Int'l, Inc., 823 F.2d 768 (3d
Cir. 1987); Couch v. St. Croix Marine Inc., 667 F.Supp. 223
(D.V.I. 1987); Erysthee v. El Nuevo Lirio Grocery, 25 V.I. 307
(D.V.I. App. Div. 1990). Such comparisons do provide some

13
 Because of its misleading character, such unsupported

and speculative expert testimony should not be received into

evidence on the retrial.

Another ruling that requires some comment was the

exclusion of the testimony of Dr. Walter Pedersen, the

plaintiff's attending physician. Before the trial commenced, the

court ruled in limine that defendant could not call the physician

as a witness. Dr. Pedersen had treated plaintiff after the

accident and submitted a report to the plaintiff's attorney. She,

in turn, sent a copy to the defendant's counsel. About two years

later, in the final pretrial order, plaintiff submitted a list of

witnesses he proposed to call. Dr. Pedersen's name was not

included. The defense, however, as part of its pretrial

submission, listed Dr. Pedersen as a fact witness in its case.

After receiving the plaintiff's witness list, the

defendant's counsel met with Dr. Pedersen. Plaintiff had

previously executed a broadly-worded medical information release

that would permit such an interview. Defense counsel did not

tell the plaintiff's lawyer of his intention to discuss the

plaintiff's injury with the physician.

The trial court based its exclusionary ruling on three

grounds:

(1) despite local practice, defense counsel had failed

to notify the plaintiff's lawyer of the interview;

guidance for courts in considering whether a verdict is excessive
and we commend the use of such data.

14
 (2) the defense proposed to elicit expert opinion

evidence from Dr. Pedersen although he had been listed in its

pretrial submission as a fact witness; and

(3) Dr. Pedersen had not submitted a report of his

opinion to plaintiff as required by Fed. R. Civ. P. 26(b)(4)(B).

In DeMarines v. KLM Royal Dutch Airlines, 580 F.2d

1193, 1201-02 (3d Cir. 1978), we discussed the factors that must

be assessed in excluding a witness's testimony because of failure

to comply with pretrial notice requirements:
1. the prejudice or surprise in fact to the opposing
party;

2. the ability of that party to cure the prejudice;

3. the extent to which the orderly and efficient
trial of the case would be disrupted; and

4. bad faith in failing to comply with the court's
order.

In addition, the significance of the practical importance of the

excluded evidence must be taken into consideration. Id. at 202.

See also Johnson v. H.K. Webster, Inc., 775 F.2d 1, 8 (1st Cir.
1985); Stich v. United States, 730 F.2d 115, 118 (3d Cir. 1984).

We find no evidence of surprise to plaintiff in the

rather unusual situation present here. Plaintiff had previously

obtained a report from Dr. Pedersen, and we may assume that he

had been interviewed by the plaintiff's counsel. There was no

indication that the trial would have been disrupted by receiving

the physician's testimony.

15
 The trial court apparently felt bound by a local policy

articulated by the Territorial Court in Chase v. People's Drug

Store, 24 V.I. 183, 187 (Terr. Ct. 1989), which required the

plaintiff's counsel to be notified before a defense lawyer

interviewed an attending physician. Dismissing the written

authorization to release medical information, the district court

noted that despite similar waivers in Chase, the Territorial

Court adopted the practice of a New Jersey case, Stempler v.

Speidell, 495 A.2d 857 (N.J. 1985). Stempler required prior

notification to the plaintiff's counsel before defendant could

interview an attending physician.

We have reservations about the restrictions imposed in

Stempler and believe the better approach is expressed in

International Business Mach. Corp. v. Edelstein, 526 F.2d 37 (2d

Cir. 1975). There, the court referred to "time-honored and

decision-honored principles, namely, that counsel for all parties

have a right to interview an adverse party's witnesses (the

witness willing) in private, without the presence or consent of

opposing counsel and without a transcript being made." Id. at

42. We are concerned that the Chase holding hinders settlement
negotiations and trial preparation by restricting the gathering

of relevant evidence in an informal fashion, thus requiring the

more expensive and time-consuming procedures of a formal

deposition.

Furthermore, by putting his physical condition at

issue, plaintiff waived the physician-patient privilege with

respect to the injuries claimed to have been incurred in the

16
accident. See 5 V.I. Code Ann. tit. 5, § 855(4) (1967); Fed. R.

Evid. 501.

In any event, even failure to follow the Chase

procedure would not provide sufficient cause to bar Dr.

Pedersen's testimony in this case where plaintiff had received a

report from the physician and had decided not to call him as a

witness. The 1970 Advisory Committee report to Fed. R. Civ. P.

26(b)(4) noted that for discovery purposes, an expert witness who

was an actor or viewer of the occurrence that is the subject

matter of the lawsuit should be treated "as an ordinary witness."

That same viewpoint is applicable here in the trial setting.

17
 The significance of Dr. Pedersen's testimony is

apparent from the dispute over whether the plaintiff's back

condition was caused solely by the automobile accident in 1990.

Our review of the trial record reveals references to previous

injuries to the plaintiff's lower back in 1969, 1975, 1978, 1980,

1981, 1982 (two incidents), 1983, and 1986. In 1990, shortly

before the accident in this suit, he also had an x-ray of the

lower back.

Dr. Pedersen treated plaintiff for some of these

previous injuries as well as those incurred in the auto accident

in December of 1990. The extent of the plaintiff's disability

caused by the pre-existing injuries and that portion attributable

to the Rene collision are crucial in the determination of a

proper damage award. It seems likely that Dr. Pedersen's

testimony would be helpful to making an evaluation on causation,

and he should be permitted to testify at the retrial. Of course,

the trial court may require the defense to produce, in advance of

trial, a report by Dr. Pedersen of any additional matters,

including opinions that he intends to testify about, that had not

been included in any previous reports to, or interviews with, the

plaintiff's counsel.

18
 Because other evidentiary matters raised by the defense

may be obviated on the retrial, we do not address nor decide them

at this juncture.

The judgment of the district court will be reversed and

the case remanded for a new trial. Costs to abide the event.
___________________________________

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