No. 13142
I N THE SUPREME COURT O THE STATE OF M N A A
F OTN
1976
JOHN 0. STORRUSTEN,
P l a i n t i f f and A p p e l l a n t ,
-vs -
ROBERT HARRISON; KEHRWALD CONSTRUCTION
COMPANY, and J O H N DOE, a n i n d i v i d u a 1,
Defendants and Respondents.
Appeal from: D i s t r i c t Court o f t h e F i f t h J u d i c i a l D i s t r i c t ,
Honorable Frank E. B l a i r , Judge p r e s i d i n g .
Counsel o f Record :
For A p p e l l a n t :
M c K i t t r i c k and I)uffy, G r e a t F a l l s , Montana
J o s e p h W. Duffy a r g u e d , G r e a t F a l l s , Montana
For Respondents:
C o r e t t e , Smith and Dean, B u t t e , Montana
Gerald R. A l l e n a r g u e d , B u t t e , Montana
Poore, McKenzie, Roth, Robischon and Robinson,
B u t t e , Montana
A l l e n R. McKenzie a r g u e d , B u t t e , Montana
Submitted: March 1 2 , 1976
,) - \ \
Decided :
y 3 a
I. 2
Filed :
Mr. Justice Gene B. Daly delivered the Opinion of the Court.
Plaintiff, John 0 Storrusten appeals from summary
.
judgment entered by the district court, Beaverhead County,
for defendants Kehrwald Construction Company and Robert Harri-
son, relieving them of liability for plaintiff's injury.
The events leading to plaintiff's injury are: On May
17, 1971, defendant Harrison contracted with defendant Kehrwald
Construction Company for the construction of a calving shed on
Harrison's ranch property in Beaverhead County. Pursuant to this
contract, Kehrwald Construction purchased numerous fifty-foot
trusses from Brenna Truss Company in Great Falls, Montana, with
the understanding that the trusses would be delivered to the con-
struction site by Brenna. Plaintiff Storrusten, an employee of
Brenna, helped load the trusses on a truck and delivered them to
the ranch on July 12, 1971. Upon arrival, plaintiff was asked
by defendants to participate in the unloading of the trusses.
Harrison provided his own services, as well as that of his employee
Jim McAndrews, and a tractor loader. Melford Kehrwald, owner of
Kehrwald Construction, provided his services as well as that of
his father, Charles Kehrwald.
The unloading procedure was: plaintiff would cut some of
the bands holding the bundled trusses and chain up those trusses
to be removed; the remaining band was held in place to keep the
trusses from springing apart until Storrusten could be clear.
Once he was clear he would signal Charles Kehrwald, who would then
cut the remaining band. McAndrews, operating the tractor-loader,
would hoist the trusses off the truck. Harrison and Melford
Kehrwald then stacked the unloaded trusses.
No problem developed in the unloading until the last
bundle. At that time, Storrusten alleged Charles Kehrwald cut
the last band before he had an opportunity to get out of the way
- 2 -
and Storrusten was struck by the falling trusses, sustaining
serious neck and shoulder injuries.
The amended complaint alleged Storrusten received these
injuries as a direct and proximate result of the negligence of
Charles Kehrwald, while acting within the scope of his employ-
ment for Kehrwald Construction Company, Harrison, or both.
Depositions were taken of Storrusten, Harrison, Melford
Kehrwald and Charles Kehrwald. Finding the loaned servant doc-
trine applicable, the district court granted summary judgment
to Kehrwald Construction. Apparently agreeing with Harrison's
contention as to the lack of responsibility on his part for the
unloading operation, the district court also granted summary
judgment to Harrison.
The issues on appeal are:
(1) Was summary judgment in favor of Kehrwald Construction
Company proper upon the facts before the district court?
(2) Was summary judgment in favor of Robert Harrison proper
upon the facts before the district court.
Under Rule 56 (c), M.R.Civ.P., defendants, being the mov-
ing parties for summary judgment, had the burden of proving the
absence of any genuine issue as to any material fact to be entitled
to judgment, as a matter of law. Stensvad v. Miners & Merchants
Bank, 163 Mont. 409, 517 P.2d 715. In determining the extent of
the moving party's burden in a summary judgment action, this Court
in Kober & Kyriss v. Billings Deaconess Hospital, 148 Mont. 117,
122, 417 P.2d 476, recognized the principle of law stated in 6
Moore's Federal Practice, 5 56.15[3] and quoted:
"'The courts hold the movant to a strict standard.
To satisfy his burden the movant must make a
showing that is quite clear what the truth is,
and that excludes any real doubt as to the exis-
tence of any genuine issue of material fact.'"
In view of these considerations, we hold Harrison met this burden,
but Kehrwald Construction Company did not.
Considering the summary judgment in favor of Kehrwald Construc-
tion Company, the memorandum accompanying the district court's
order stated the loaned servant doctrine precluded Kehrwald
Construction Company from being held liable for Storrusten's in-
juries. Plaintiff, on the other hand, contends Kehrwald Construc-
tion failed to meet its burden of conclusively showing that Charles
Kehrwald, the man whose actions allegedly proximately caused
plaintiff's injuries, became the borrowed servant of plaintiff
for the duration of the unloading operation. After examining
the record, we agree with plaintiff's contention. The record re-
veals Charles Kehrwald was in the employ of Kehrwald construction
Company.
In an action where the loaned servant doctrine becomes
an issue, the ultimate question is--in whose business was the
servant engaged? Devaney v. Lawler Corp., 101 Mont. 579, 56 P.2d
746. Depending upon the circumstances of any given case several
factors may be considered, but only two factors need be discussed
here as they are dispositive of the issue.
(1) Under whose control and direction was the unloading
conducted?
(2) For whose benefit was this operation undertaken?
As to the question of control and direction, there is a
substantial dispute. Kehrwald Construction Company relies upon
the uncontested fact that plaintiff chained the trusses for un-
loading and directed the cutting of the bands, for its position
that plaintiff was directing the unloading. At one point in his
deposition plaintiff stated he directed the unloading. However,
other statements by plaintiff in his deposition and others present
during the unloading, tend to point to a different conclusion.
Plaintiff testified he was not instructed by Brenna Truss Company
to see to the unloading. Only when such specific instructions
were given by Brenna was it customary for him to undertake such
an operation. In fact, it was Melford Kehrwald who solicited
both manpower and equipment for the unloading. Additionally,
Melford Kehrwald professed ignorance as to the method of unload-
ing and asserted this was the reason plaintiff directed the
operation. Yet under questioning Melford Kehrwald admitted he
had unloaded trusses before. After Storrusten was injured,
Melford Kehrwald and the other men did not seem to have any great
difficulty in unloading the remaining trusses. Finally, Melford
Kehrwald admitted directing the actual truss unloading from the
truck. In view of these facts it becomes an open question whether
plaintiff was the person in charge of the unloading operation.
In summary of the direction-control factor under the loaned
servant doctrine, we believe the statement of the United States
Supreme Court in the landmark loaned servant case Standard Oil Co.
v. Anderson, 212 U.S. 215, 29 S.Ct.252, #53 L ed 480, 485, is apropos
to the circumstances here:
"Much stress is laid upon the fact that the
winchman obeyed the signals of the gangman, who
represented the master stevedore, in timing the
raising and lowering of the cases of oil. But
when one large general work is undertaken by
different persons, doing distinct parts of the
same undertaking, there must be co-operation
and co-ordination, or there will be chaos. The
giving of the signals under the circumstances of
this case was not the giving of orders, but of
information; and the obedience to those signals
showed co-operation rather than subordination,
and is not enough to show there has been a change
of masters."
As to the question of benefit from work done, this Court
has had occasion to consider it as a factor in loaned servant
litigation in the past. Lewis v. Potter, 149 Mont. 430, 427 P.2d
306; Western Foundry, Inc. v. Matelich, 150 Mont. 228, 433 P.2d
789. We again find it an important factor in the instant case.
Plaintiff contends that all unloading work undertaken after
the delivery of the trusses to the Harrison ranch accrued to the
benefit of defendants not plaintiff, thus making the loaned servant
doctrine inapplicable. From our examination of the record con-
siderable dispute exists as to the benefit question, so as to
render summary judgment in favor of Kehrwald Construction Com-
pany inappropriate. First, the invoice, a delivery order type
of bill of lading, entered into evidence as Exhibit No. 1, was
signed by Melford Kehrwald when plaintiff arrived at the ranch
and before the unloading began. The bill of lading contained no
unloading instructions. There was, in fact, nothing on it which
restricted transfer of ownership of the trusses at the time of
delivery.
Section 87A-1-201, R.C.M. 1947, defines a bill of lading
" ( 6 ) * * * a document evidencing the receipt of
goods for shipment issued by a person engaged in
the business of transporting or forwarding goods
* * *.I!
Section 87A-1-201, R.C.M. 1947, defines a document of
title as:
"(15) * * * bill of lading * * * or order for the
delivery of goods, and also any other document
which in the regular course of business or finan-
cing is treated as adequately evidencing that the
person in possession of it is entitled to receive,
hold and dispose of the document and the goods
it covers. To be a document of title a document
must purport to be issued or addressed to a bailee
and purport to cover goods in the bailee's posses-
sion which are either identified or are fungible
portions of an identified mass."
Section 87A-2-401, R.C.M. 1947, in pertinent part provides:
"(2) Unless otherwise explicitly agreed title
passes to the buyer at the time and place at which
the seller completes his performance with reference
to the physical delivery of the goods * * *
"(b) if the contract requires delivery at destina-
tion, title passes on tender there."
Since it is not urged by Kehrwald Construction Company
that Brenna had an obligation to unload the trusses and it is
explicitly denied by plaintiff there can be no question that the
tender of the trusses and Melford Kehrwald's signing of the
bill of lading terminated any responsibility that Brenna Truss
or plaintiff had for the goods.
Substantial issues of material fact were raised as to
control of the unloading and for whose benefit it was done,
therefore summary judgment for Kehrwald Construction Company
under the loaned servant doctrine is inappropriate.
In regard to the summary judgment in favor of defendant
Harrison, plaintiff contends Harrison retained such control
over the unloading operation to render him subject to liability.
We find no merit in this contention.
Plaintiff alleges such control by Harrison indicates a
joint enterprise relationship with Kehrwald Construction Company.
Prosser Torts 4th Ed. 475 defines a joint enterprise to be:
" * * * something like a partnership, for a more
limited period of time, and a more limited purpose.
It is an undertakinq to carry out a small number
of acts or objectives, which is entered into by
associates under such circumstances that all have
an equal voice in directinq the conduct of the
enterprise. The law then considers that each is the
agent or servant of the others, and that the act of
any one within the scope of the enterprise is to
be charged vicariously against the rest." (Emphasis
supplied.)
See: Sumner v. Amacher, 150 Mont. 544, 437 P.2d 630; Rae v.
Cameron, 112 Mont. 159, 114 P.2d 1060.
Whether Harrison and Kehrwald Construction Company were
joint venturers so as to render Harrison liable for the acts of
Kehrwald Construction Company's employee, Charles Kehrwald, must
be determined from the contract executed by defendants and the
circumstances surrounding the unloading. The contract, produced
in evidence, specifically designates Melford Kehrwald as "con-
tractor" and Harrison as "contractee" and clearly states there
are no covenants, promises, or agreements, written or oral, except
as set forth in the writing; no mention is made of a joint enter-
prise relationship. The depositions of all participants dis-
close no facts tending to show control by Harrison over the
unloading operation; rather the depositions place Harrison
several feet distant from the truck during the unloading and
aiding only in the stacking of the trusses.
In view of these facts, this Court's holding in Greening
v. Gazette Printing Co., 108 Mont. 158, 165, 166, 88 P.2d 862,
is directly in point. In Greening this Court was asked to
determine the relationship between two contracting parties in an
effort to determine possible liability for injuries to a third
person. The Court said:
"As between the parties, the written contract is
controlling as to the relationship, and ordinarily
neither party may vary it by par01 testimony; but
as to third parties, this is not the case. What-
ever obligations the relation might impose on
either as respects third parties could not depend
upon the nature of the stipulations, but must spring
from the relation itself. * * *
" * * * There was no testimony to show that any
control over Stewart, other than that provided for
in the contract, was exercised by the respondent,
and particularly there is no showing of any such
exercise of control on the day of the injury com-
plained of. Had such a showing been made, the
question of the relationship at the time of the
injury should properly have been submitted to the
jury; but since no such showing was made, the
relationship must be determined by the contract
itself. "
Similarly, in the instant case, no testimony in deposition in-
dicates in any way that Harrison had an "equal" input into the
unloading operation, to qualify the undertaking as a joint enter-
prise. Thus, as in Greening, we are left with the terms of the
contract in determining a possible basis for Harrison's lia-
bility. Since the contract explicitly provides for a contractor-
contractee relationship, with no mention of a joint enterprise,
we find no material issue of fact as to Harrison's liability
under a joint enterprise theory.
Finally plaintiff, apparently pleading in the alternative
a r g u e s t h a t a n employer-independent c o n t r a c t o r r e l a t i o n s h i p
may have e x i s t e d between t h e d e f e n d a n t s b u t t h a t t h e f a c t s t e n d
t o show H a r r i s o n r e t a i n e d s u c h c o n t r o l o v e r t h e work t o be l i a b l e
f o r t h e accident. The g e n e r a l r u l e i s t h a t t h e employer o f a n
independent c o n t r a c t o r i s n o t l i a b l e f o r t h e negligence of t h e
c o n t r a c t o r o r h i s employees. 57 C.J.S. Master and S e r v a n t 8584.
So t h e q u e s t i o n becomes--did H a r r i s o n r e t a i n such c o n t r o l a s t o
t r i g g e r an exception t o t h e independent c o n t r a c t o r r u l e ? Rely-
i n g on t h e same s o u r c e u t i l i z e d by p l a i n t i f f , 2 R e s t a t e m e n t o f
T o r t s 2d S 4 1 4 , Comment ( c ) p. 388, s t a t e s :
"In order f o r t h e r u l e s t a t e d i n t h i s Section
t o a p p l y , t h e employer must have r e t a i n e d a t
l e a s t some d e g r e e of c o n t r o l o v e r t h e manner
i n which t h e work i s done. I t i s n o t enough
t h a t he has merely a g e n e r a l r i g h t t o o r d e r t h e
work s t o p p e d o r resumed, t o i n s p e c t i t s p r o g r e s s
o r t o r e c e i v e r e p o r t s , t o make s u g g e s t i o n s o r
recommendations which need n o t n e c e s s a r i l y be
f o l l o w e d , o r t o p r e s c r i b e a l t e r a t i o n s and d e v i a -
tions. Such a g e n e r a l r i g h t i s u s u a l l y r e s e r v e d
t o employers, b u t it d o e s n o t mean t h a t t h e con-
t r a c t o r i s c o n t r o l l e d a s t o h i s methods of work,
o r a s t o o p e r a t i v e d e t a i l . T h e r e must be s u c h a
r e t e n t i o n of a r i g h t of s u p e r v i s i o n t h a t t h e
c o n t r a c t o r i s n o t e n t i r e l y f r e e t o d o t h e work i n
h i s own way."
Upon t h e r e c o r d i n t h i s c a s e , t h e e x c e p t i o n c i t e d by p l a i n t i f f
i s i n a p p l i c a b l e b e c a u s e t h e r e i s no f a c t u a l ground t o s u p p o r t a
f i n d i n g o f a n y r e t e n t i o n o f s p e c i f i c c o n t r o l by H a r r i s o n . The
mere f a c t he a s s i s t e d i n t h e s t a c k i n g o f t h e t r u s s e s i s i n s u f -
f i c i e n t t o e s t a b l i s h t h e d e g r e e of c o n t r o l c o n t e m p l a t e d by t h e
exception.
W e a f f i r m t h e summary judgment i n f a v o r of Robert H a r r i s o n .
W e r e v e r s e t h e summary judgment a s t o K e h r ~ a l d ~ C o n s t r u c t i o n
Company.
,
/ Justice 1
W Justices
Hon. B e r n a r d Thomas, D i s t r i c t
Judge, s i t t i n g i n p l a c e o f M r .
C h i e f J u s t i c e James T . H a r r i s o n .