Clarke v. Vandermeer

740 P.2d 921, 1987 Wyo. LEXIS 477

• Court: Wyoming Supreme Court
• Decided: July 27, 1987
• Docket: 86-184
• Status: Published

Opinions

CARDINE, Justice.

This is a negligence case in which appel-lee Barbara Vandermeer was awarded a $425,000 judgment for injuries sustained in a motor vehicle accident. Appellants Alex Clarke and Auto Driveaway Company raise the following issues on appeal: (1) whether the trial court properly admitted evidence of Auto Driveaway's liability insurance policy; (2) whether the trial court erred in refusing to give several jury instructions offered by appellants; (3) whether the trial court erred in admitting certain hearsay statements into evidence; (4) whether ap-pellee laid a sufficient foundation for the testimony of her economic witness; (5) whether the jury's verdict was supported by sufficient evidence; and (6) whether the trial court erred in denying appellants’ motions for new trial.

We affirm.

FACTS

On the night of March 22, 1981, appellee Barbara Vandermeer was hauling a load of apples from Yakima, Washington, to an eastern destination. While traveling through Wyoming on 1-80, she formed a loose convoy with two other truckers she met on the highway. On the same night, appellant Alex Clarke and his friend Paul Bechtel, two students at the University of Wisconsin, were returning from spring break in California via 1-80. The car they were driving was leased by Louis Allis Company, and the two students were transporting the car from California to Wisconsin for Auto Driveaway Company.

At approximately 1:30 a.m., Ms. Vander-meer came upon the Clarke vehicle on the interstate and attempted to pass it. According to Ms. Vandermeer, the Clarke vehicle drifted into her lane of traffic as she made the pass. To avoid a collision, she swerved to the left, went off the left side of the road, and pulled the truck back onto the road but was unable to control it. The truck went back across the paved surface, off the right-hand side of the road, and struck an embankment. Ms. Vandermeer apparently was not injured at that point, but steam and smoke were rising from the badly damaged truck. Fearing an explosion and unable to open the driver’s side door, Ms. Vandermeer jumped from the driver’s window, injuring her back as she landed on the ground.

Ms. Vandermeer’s back injuries required extensive treatment, including two spinal fusion operations. In 1985, Ms. Vander-meer filed a negligence action against Alex Clarke alleging that he failed to keep a proper lookout for other traffic and failed to keep proper control of his vehicle. Ms. Vandermeer also named Auto Driveaway as a defendant, asserting that Alex Clarke was acting as its employee when the accident occurred and the company was vicariously liable for Mr. Clarke’s negligence.

A jury found that Alex Clarke and Ms. Vandermeer were both negligent but concluded that Ms. Vandermeer’s negligence did not cause or contribute to her injuries. The jury further determined that at the time of the accident Alex Clarke was acting as an employee of Auto Driveaway. The jury awarded Ms. Vandermeer $425,000 in damages. After entry of judgment on the verdict, appellants moved for judgment notwithstanding the verdict, new trial, and/or remittitur. They now appeal from the trial court’s denial of those motions.

EVIDENCE OF INSURANCE

Appellants first contend that the trial court committed reversible error by permitting appellee to introduce evidence of Auto Driveaway’s liability insurance. In response, appellee asserts that the evidence was relevant and admissible on the contested issue of whether an employment relationship existed between Auto Driveaway and Alex Clarke.

The insurance issue arose at several points in the trial. The first reference to insurance came when appellee introduced the following deposition testimony of Gary Wolfe, an employee of Louis Allis Company, who procured the services of Auto Driveaway:

“Q. I’ll hand you what’s been marked as Exhibit 21 and ask you if you recognize that.

“A. Yeah. This is a — a letter after my wife had called two or three driveaway services, this was a letter she had received from Elizabeth Schneider confirming their discussion.

“Q. And what is the date of that letter?

“A. March 4, 1981.

“Q. Now, I notice on that letter that there’s a paragraph that’s — or part of a paragraph that is circled in blue ink; is that correct?

“A. Right.

“Q. And who did that?

“A. I did.

* * * * * *

“Q. Why did you do that?

“A. I did it because I was concerned about their insurance coverage, but I can’t specifically recall when I made the circle.

“Q. What does that part that you’ve circled say?

“A. We are licensed by the Interstate Commerce Commission to transport automobiles nationwide. Our rates and certificate of insurance are on file with them in Washington, D.C.

“Q. Do you recall if you circled that before or after you received notification of the incident that forms the basis of this litigation?

“A. I can’t honestly tell you is — All I can say [is] that I was concerned about the insurance, the liability and so forth, and that’s why I circled it because it was part of our discussion with Auto Drivea-way, but to tell you the specific date, I don’t know.

“Q. What do you recall about your discussion with Auto Driveaway as it relates to the language in this?

“A. Only what I told you earlier, that generally we were concerned about the reputation of the company, their experience in the industry, and as anybody would be concerned if they were going to move their — have somebody else move their car, what kind of insurance coverage they had and how we would be protected and how the car itself would be protected, but I can’t specifically say these are the four items we talked about and this is what she told me * *

At appellee’s request, a bench conference was held before these portions of Mr. Wolfe’s deposition were read into evidence. Appellants objected to the admission of this testimony and all other references to Auto Driveaway’s insurance coverage on the grounds that the evidence was highly prejudicial and contained no probative value. The court overruled the objection, concluding that the evidence was probative on the issue of the employment relationship between Mr. Clarke and Auto Driveaway.

As the trial progressed, another reference to insurance coverage was allowed into evidence over appellants’ objections:

“Q. [Mr. Burke] In answering the complaint for which this action’s been filed, Auto Driveaway has indicated that Mr. Clarke was acting as an independent contractor and they’re not responsible for any of the actions of Mr. Clarke. That’s the position they’ve taken in this litigation. What I’m asking you is did they ever do anything and communicate in any way to you that they took the position that they weren’t in any way responsible for the actions of their drivers?

“A. [Mr. Wolfe] Quite the contrary. I wouldn’t have — Anybody in their right mind wouldn’t sign up with a company that was saying, hey, we’re just going to put you in touch with a third party, and then what he does with your car is not our matter. They made special — They took a lot of care to indicate that they did go through a selection process and that the people that drove the cars for them were — were screened and looked at. They didn’t just pick anybody that wanted to come in and take the car.

“That was — And it wasn't only my concern. It was the concern of the company. The cost was a concern of the company. The insurance coverage was a concern of the company, and they had the same things to consider that I did.”

The subject of insurance came up once again during the following deposition testimony of Irwin Schneider, an agent of Auto Driveaway:

“Q. Auto Driveaway carries insurance that protects somebody else that might get injured by that driver, correct?

“A. Correct.

“Q. But you don’t carry any insurance that protects the driver?

“A. Correct.

“Q. ‘Our drivers are independent contractors.’ I just want to know why you use that phrase.

“A. Well, the only answer I can give to that is the fact that they are not employees.

“Q. With regard to Auto Driveaway’s relationship to the driver, they have an independent-contractor relationship as far as you’re concerned; is that correct?

“A. Correct.”

At the close of Mr. Wolfe’s testimony, the court instructed the jury that it should consider the evidence of insurance only on the employment issue. A second limiting instruction was given before the jury began its deliberations. Appellants contend that the evidence was irrelevant and highly prejudicial, that the limiting instructions were insufficient to cure the resulting prejudice, and that the admission of the evidence constituted reversible error.

Rule 411, W.R.E., provides:

“Evidence that a person was or was not insured against liability is not admissible upon the issue of whether he acted negligently or otherwise wrongfully. This rule does not require the exclusion of evidence of insurance against liability when offered for another purpose, such as proof of agency, ownership, or control, or bias or prejudice of a witness.”

In this case the evidence was not offered to prove negligence; it was offered on the issue of whether Alex Clarke was an employee of Auto Driveaway. Evidence of liability insurance may be admissible to prove an employer-employee relationship. See Holly Sugar Corporation v. Perez, Wyo., 508 P.2d 595 (1973). The theory behind admitting evidence of insurance to prove this relationship is that “a party is highly unlikely to purchase insurance to cover contingencies for which he is not responsible.” 2 D. Louisell and C. Mueller, Federal Evidence § 194 at 583 (Rev’d 1985).

Appellants contend that this reasoning does not apply in the present case because Auto Driveaway was required by federal law to obtain the insurance policy in question. See 49 U.S.C. § 10927. We find this argument unpersuasive. The federal statute cited by appellants requires insurance sufficient to pay “each final judgment against the carrier.” (Emphasis added.) Id. If Mr. Clarke was not an employee of the carrier, Auto Driveaway, there could be no judgment against them for his negligent acts. Therefore, we fail to see how the federal statute required Auto Driveaway to purchase an insurance policy which covered against liability for the negligence of its drivers, which it contended were not its employees. Moreover, appellants offered no evidence to show that the insurance policy was purchased only because it was required by federal law. This was merely an argument made to the court by appellants’ counsel.

We find no error in the trial court’s ruling that the evidence of insurance was probative on the employment issue. In addition, we agree with the trial court’s conclusion that the probative value of the evidence outweighed the danger of unfair prejudice. Rule 403, W.R.E.

The prevailing view among the commentators is that evidence of insurance is rarely prejudicial.

“[T]he underlying soundness of the general rule forbidding disclosure of the fact of insurance has been the object of scathing criticism. * * * Its costs include extensive and unnecessary arguments, reversals, and retrials stemming from elusive questions of prejudice and good faith. This state of affairs might be tolerable if the revelations of insurance were truly fraught with prejudice. But, * * * most jurors probably presuppose the existence of liability insurance anyway, and the heart of the policy of nondisclosure is surrendered when jurors are examined about their connection with insurance companies. Consequently, the extent to which evidence of coverage or its absence is prejudicial is unclear. Even the direction in which such prejudice might work is obscure.” McCormick on Evidence § 201 at 597 (3rd ed. 1984). See also 23 Wright & Graham, Federal Practice and Procedure: Evidence § 5369 (1980); 2 D. Louisell and C. Mueller, Federal Evidence, supra, § 193.

McCormick’s treatise suggests that a limiting instruction will usually cure any possible prejudice:

“If disclosure of the fact of insurance really is prejudicial, the corrective is not a futile effort at concealment, but the usual fulfillment by the court of its function of explaining to the jury its duty to decide according to the facts and the substantive law, rather than upon sympathy, ability to pay, or concern about proliferating litigation and rising insurance premiums.” McCormick, supra, at 598.

In the present case, the trial court thoroughly instructed the jury that the evidence of insurance was to be considered for the limited purpose of determining whether Mr. Clarke was an employee of Auto Drive-away. We assume the jury followed those instructions, Barnette v. Doyle, Wyo., 622 P.2d 1349 (1981), and we find no error under these circumstances.

REFUSAL OF APPELLANTS’ JURY INSTRUCTIONS

Appellants assert that the trial court erred in refusing three proposed jury instructions. The first two, offered by Mr. Clarke, related to Ms. Vandermeer’s failure to sound her horn when passing. The third, offered by Auto Driveaway, referred to ICC regulations prohibiting the consumption of an alcoholic beverage within four hours of driving and the possession of an alcoholic beverage when driving.

Mr. Clarke’s proposed Instruction A stated:

“You are instructed that Section 31-5-952(a) of the Wyoming Statutes provides, in pertinent part, that ‘ * * * the driver of a motor vehicle shall when reasonably necessary to insure safe operation give audible warning with his horn but shall not otherwise use such horn when upon a highway.’ Under certain circumstances a driver may be held negligent for not sounding his horn prior to attempting a pass. Such circumstances may include situations in which the overtaking driver might expect the forward vehicle to meander due to wind and situations in which the forward driver is likely to be surprised by the pass. Whether such circumstances exist within the context of this case is a determination that you must make based upon all the facts and circumstances presented herein.”

The trial court refused this instruction because

“[t]he material * * * added to the statute tends to go beyond the situation in this case and would not be a fair presentation of the factual evidence.”

We have held that it is error to give an instruction if it is not supported by substantial evidence. Hernandez v. Gilveli, Wyo., 626 P.2d 74 (1981); Brubaker v. Glenrock Lodge International Order of Odd Fellows, Wyo., 526 P.2d 52 (1974). We find no substantial evidence in the record to show that Ms. Vandermeer expected the Clarke vehicle to meander due to wind or that Mr. Clarke was likely to be surprised by the pass. Mr. Clarke testified that he was aware that the truck was behind him, that he remained in his lane at all times, and that he would have been aware of an attempt to pass without Ms. Vander-meer sounding her horn. We find no abuse of discretion in the trial court’s refusal of this instruction.

Mr. Clarke’s proposed Instruction B provided:

“You are instructed that Section 31-5-952(a) of the Wyoming Statutes provides as follows:

“ ‘Every motor vehicle when operated upon a highway shall be equipped with a horn in good working order and capable of emitting sound audible under normal conditions from a distance of not less than two hundred (200) feet, but no horn or other warning device shall emit an unreasonably loud or harsh sound or whistle. The driver of a motor vehicle shall when reasonably necessary to insure safe operation give audible warning with his horn but shall not otherwise use the horn when upon a highway.’ ”

The trial court refused this instruction because it was not timely submitted:

“THE COURT: Earlier, counsel for the defendant Clarke indicated he would provide an instruction on the statute requiring motor vehicles to be equipped with horns and when they are to be used. He has now submitted to the court Instruction B, and the court has considered it and refused it at this time. The court, as I indicated earlier, had given an opportunity to counsel to prepare and submit instructions at the time of the pretrial. “And, second, they were to have them all in 20 days before trial, and together with other submitted instructions.

“And then we spent over an hour this morning going over them, and this now has been submitted at 12:57, and we are going in with the jury at 1:00 o’clock.”

The court’s pretrial order required the parties to submit instructions not later than 20 days prior to trial. The trial court has discretion in determining the requirements of adherence to pretrial orders. State v. Dieringer, Wyo., 708 P.2d 1 (1985). The court did not abuse its discretion in refusing the instruction.

The court also refused appellant Auto Driveaway’s proposed Instruction No. 13, which stated:

“At the time of the accident, it was unlawful for an interstate truck driver to consume an intoxicating beverage, regardless of its alcoholic content, within 4 hours before operating her vehicle, or to consume an intoxicating beverage regardless of its alcoholic content while operating a vehicle, or to operate a vehicle while the driver possessed an intoxicating beverage regardless of its alcoholic content.”

The source of this instruction is a federal regulation, 49 CFR § 392.5. The court refused this instruction because the subject was already covered in the following instruction given by the court:

“Whether or not a person involved in the occurrence was intoxicated at the time is a proper question for the jury to consider, together with other facts and circumstances in evidence in determining whether or not he was negligent. Intoxication is no excuse for failure to act as an ordinary prudent person would act. An intoxicated man is held to the same standard of care as a sober person.”

Appellants assert that the court’s refusal of proposed Instruction No. 13 deprived them of an opportunity to present their theory of the case. We disagree. The trial judge is afforded latitude to tailor the instructions to the facts of the case, and reversible error will not be found as long as the instructions, when viewed as a whole and in the context of the entire trial, fairly and adequately cover the issues. Scadden v. State, Wyo., 732 P.2d 1036 (1987).

HEARSAY STATEMENTS

On cross-examination, appellee’s counsel asked Mr. Bechtel (Mr. Clarke’s friend and passenger) if he heard any comments at the accident scene to the effect that Mr. Clarke had cut off Ms. Vandermeer’s truck. Appellants’ counsel objected to the question on hearsay grounds. The trial court sustained the objection, but indicated that if appellee’s counsel could lay a foundation for a hearsay exception, the testimony might be allowed. Appellee’s counsel then attempted to lay a foundation for the excited utterance exception to the hearsay rule:

“Q. With regard to the accident scene, it was a pretty excited situation around there, wasn’t it?

“A. I think any accident situation would probably be excited.

“Q. And the people that were around there were all pretty excited at the time?

“A. Not particularly.

“Q. The truck was still smoking; correct?

“A. That’s true. My thoughts were more to attending to Miss Vandermeer.

“Q. And at the time there was a possibility of explosion of the truck; is that correct?

“A. It appeared that might happen.

“Q. And there was an injured person; is that correct?

“A. That’s correct.

“Q. And people were coming up on the scene; is that correct?

“A. There were approximately three others: a police officer and the ambulance drivers.

“Q. The people that came up on the scene, other than the police officer and the ambulance drivers, were excited about the situation, weren’t they?

“A. I can’t speak for them.

* * # # * #

“Q. [D]o you recall any comment at the accident scene relating to the cause of the accident?

“MR. POWERS: Again, Your Honor, I would object. This calls for hearsay.

“THE COURT: Well, I just need a little more time frame.

* # * # ⅛ #

“THE COURT: Yes or no, do you recall any comments about the accident?

“A. Yes.

# ⅜ * * * *

“Q. [Mr. Burke] And how soon after the accident was that?

“A. In minutes?

“Q. Yes.

“A. I don’t know if I can tell you or not.

“Q. Do you recall what those comments were?

* * # * * *

“A. Yes.

“Q. And what were they?

* * * * ⅛ *

“A. The discussion I heard was generated by the other truck drivers that saw it, and I heard discussion to the essence that a white car had cut off the semi.”

This court has identified the following factors to be considered in determining whether a hearsay statement falls within the excited utterance exception:

1. The nature of the startling event;

2. The declarant’s physical manifestation of excitement;

3. The declarant’s age;

4. The lapse of time between the event and the hearsay statement; and

5. Whether the statement was made in response to an inquiry.

Matter of GP, Wyo., 679 P.2d 976 (1984). In this case, appellee failed to show a manifestation of excitement, the lapse of time between the event and the hearsay statement, and whether the statement was made in response to an inquiry. Therefore, the hearsay statement was not admissible as an excited utterance. Its admission did not constitute reversible error, however, as appellants have failed to show that a “substantial right” was affected by the ruling. Rule 103, W.R.E. At the point in the trial when the inadmissible testimony was allowed, appellee had already introduced similar testimony. Accordingly, the hearsay evidence was cumulative, and its admission was harmless. 1 D. Louisell and C. Mueller, Federal Evidence § 20 at 111 (1977).

FOUNDATION FOR ECONOMIC WITNESS TESTIMONY

Appellants next argue that the testimony of Ms. Vandermeer’s economic witness, Dr. Jerome Sherman, should have been excluded for lack of adequate foundation. Appellants claim that Dr. Sherman’s testimony amounted to speculation because he relied on Ms. Vandermeer’s oral statement that she earned $388.40 per week. The $388.40 figure, however, was supported by a document which had already been admitted into evidence when Dr. Sherman testified. The trial court did not abuse its discretion by allowing Dr. Sherman to rely on the oral statement.

Appellants also claim that the court deprived them of an opportunity to voir dire Dr. Sherman on the adequacy of the information he relied upon in forming his opinions. This contention is equally without merit. When appellants requested an opportunity to voir dire Dr. Sherman, the court did not deny the request but instead ruled that appellants’ request was premature:

“Q. [By Mr. Burke]: Doctor, when we employed you to — well, what information did you need in order to perform an economic analysis?

“MR. SCOTT: Excuse me, Your Honor. May I voir dire the witness?

“THE COURT: For what purpose, counsel?

“MR. SCOTT: Do you wish me to approach the bench?

“THE COURT: I just wanted to know, are you going to attempt to ascertain whether or not he is qualified to be designated as an expert — is that your purpose?

“MR. SCOTT: No, Your Honor. The basis of the voir dire would be the adequacy of the information upon which he is basing his opinion.

“THE COURT: I think that would be cross-examination, or at least when he is giving the information or testified to what information he is using, you may bring it to our attention then.”

Because appellants never renewed their request at the appropriate time, they waived any opportunity to voir dire Dr. Sherman. We find no error in the trial court’s rulings regarding the admissibility of Dr. Sherman’s testimony.

SUFFICIENCY OF THE EVIDENCE

The jury found that Ms. Vandermeer was negligent but also found that her negligence did not contribute to or cause her injuries. Appellants contend that the record contains insufficient evidence to support this finding. In support of this assertion, they point to the following “undisputed” evidence:

1. Ms. Vandermeer was speeding at the time of the accident;

2. Ms. Vandermeer failed to sound her horn;

3. Ms. Vandermeer had insufficient sleep under ICC regulations; and

4. Ms. Vandermeer violated ICC regulations by drinking one or two beers in Rock Springs several hours before the accident.

Appellants’ argument misses the point. This evidence merely supports the jury’s finding that Ms. Vandermeer was negligent; it does not demonstrate causation.

Whether a breach of duty is the proximate cause of an injury is a question of fact for the jury to determine. Caterpillar Tractor Company v. Donahue, Wyo., 674 P.2d 1276 (1983). The record contains ample evidence to support the jury’s allocation of fault. Ms. Vandermeer testified that Mr. Clarke drifted into her lane and caused her to take the evasive action which led to her injuries. Rodney Resh, a member of the loose convoy traveling with Ms. Vandermeer, testified that the Clarke vehicle was weaving when he passed it and, when he looked in his rear view mirror, “it looked like the car’s headlights went over towards [Ms. Vander-meer’s] truck [and] the truck moved over to the left and suddenly made a sharp right-hand turn across the highway and into the side of the mountain.” On appeal we must accept this evidence as true and give the prevailing party every favorable inference which may be fairly and reasonably drawn from it. Reese v. Dow Chemical Company, Wyo., 728 P.2d 1118 (1986). We find it reasonable for the jury to conclude that Ms. Vandermeer’s negligence did not contribute to or cause her injuries, and we reject appellants’ contention that the verdict was not supported by the evidence.

NEW TRIAL

Appellants moved for a new trial on the grounds of insufficient evidence and errors of law occurring at the trial. Rule 59(a)(1), (8), W.R.C.P. The trial court expressed some reluctance in denying appellants’ motion:

“The Court was troubled, however, by the argument of defendants that ‘the jury's verdict is not supported by sufficient evidence, fails to administer substantial justice to the parties, and represents a miscarriage of justice.' As expressed to counsel at the time of the oral hearing, the Court does have a general feeling of ‘uneasiness,’ which I believe I described more as a ‘gut feeling,' that perhaps the verdict failed to administer substantial justice to the parties. A review of the evidence as I recall it, however, convinces me that there was substantial and competent evidence from which the jury’s findings, set forth above, could be made.

“I have reviewed the reasons set forth in Rule 59 for granting a new trial. None of them indicate that the Court either should or may grant a new trial simply because I have the ‘gut feeling’ mentioned above.”

We have already determined that the verdict was supported by sufficient evidence and that no reversible errors of law occurred. Appellants urge, however, that the grounds for new trial enumerated in Rule 59 should not be held to be exclusive and that a trial judge should be allowed to grant a new trial at any time that he feels substantial justice has not been served.

It has been the law in Wyoming for many years that the enumerated grounds are the exclusive grounds upon which a new trial may be granted. Stanton v. Chicago B. & Q.R. Company, 25 Wyo. 138, 165 P. 993 (1917); In re Bosick, 48 Wyo. 46, 41 P.2d 533 (1935). In Town of Jackson v. Shaw, Wyo., 569 P.2d 1246, 1254 (1977), we stated:

“[I]t is the duty of a judge, when not satisfied with a jury verdict, to set it aside and grant a new trial for one of the reasons allowed.” (Emphasis added.)

Appellants suggest that one of our more recent opinions, which states that a trial judge should grant a new trial whenever a jury verdict fails to administer substantial justice, reflects a departure from this rule. Cody v. Atkins, Wyo., 658 P.2d 59 (1983). The substantial justice standard, however, is not an individual ground upon which a new trial may be granted. It is merely a criterion to guide trial judges when deciding whether a new trial should be ordered for one of the reasons enumerated in Rule 59. The district court properly denied appellants’ motion for new trial.

Affirmed.