Merchants National Bank v. Waters

447 F.2d 234
CourtCourt of Appeals for the Eighth Circuit
DecidedAugust 30, 1971
DocketNos. 20727, 20728
StatusPublished
Cited by1 cases

This text of 447 F.2d 234 (Merchants National Bank v. Waters) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Merchants National Bank v. Waters, 447 F.2d 234 (8th Cir. 1971).

Opinions

LAY, Circuit Judge.

Merchants National Bank, the administrator of the Estate of Elizabeth W. Smith, deceased, and of the Estate of Mignon Pease, deceased, recovered verdicts of $125,000 and $65,000, respectively, from The Boeing Company, by reason of the negligence of its employee, Delmar Messer, now deceased.1 Reversal of the judgment is sought on two basic grounds: (1) there was insufficient evidence to sustain plaintiff’s claim that Delmar Messer was acting within the scope of his employment with Boeing at the time of the accident in question and (2) that the verdicts were excessive.2 We affirm the judgments rendered.

The sole issue relating to the liability of The Boeing Company is whether Delmar Messer was acting within the scope of his employment with The Boeing Company at the time of the accident. The trial court considered the issue as one of fact under Iowa law and submitted the question to the jury who determined it adversely to Boeing.

On July 26, 1966, an automobile accident occurred when Messer was driving his personal automobile westbound on 1-80 near Oxford, Iowa. His vehicle suddenly crossed the grass median of the interstate highway and veered into the oncoming lane of traffic, colliding with the eastbound vehicle occupied by the decedents. Elizabeth Smith, 23 years old, was severely injured and died ten days later. Mignon Pease, age 22, died instantaneously. Delmar Messer had worked as a tool designer for Boeing since 1953. In March, 1963, he was transferred from Seattle, Washington to Boeing’s Michoud plant near New Orleans. He had been assured at the time of this transfer that upon conclusion of this work at Michoud (estimated to be three to five years) he would be moved back to Seattle by Boeing at company expense. At the time of the transfer he was reimbursed fully for his expenses and given thirty days per diem as well as one month’s salary for relocation pay. In March, 1965, having become dissatisfied with living and working conditions in Louisiana, Messer asked for a transfer either to Seattle or Huntsville, Alabama. He was at that time placed on a “surplus list.” 3 Ultimately, in June or July of 1966, he and many other Michoud employees were interviewed by the project chief of tool design on the SST program. At this time there was a growing need in Seattle for workers with tool design skills. Messer was selected and authorized to transfer to Seattle. On his transfer, the [236]*236company placed Messer under a partial rather than a full reimbursement plan. It authorized this reimbursement as thereby fulfilling its prior obligation to return Messer back to Seattle.4 His travel authorization included a travel advance of $300, reimbursement per diem for nine and one-half days travel time, mileage expenses and household moving and warehousing expenses. Messer’s travel orders required him to report to a Mr. Shawlee at a particular building in Seattle on August 8, 1966. Although the company did not specify any particular route mileage was allowed for 2,610 miles, the most direct routing. The reporting date specified Messer to have six days travel time and three and one-half days to relocate in Seattle.

On this transfer Boeing did not allow (as it had on his earlier transfer to New Orleans) a relocation allowance (thirty days per diem) nor did it pay Messer’s salary. There was evidence introduced that Boeing would have been obligated to pay Messer’s salary if he had been traveling on company business. However, Messer arranged with Boeing to have his vacation time coincide with his travel time so that he would continue to be on full salary. In his deposition Messer testified that the trip route he was on the day of the accident was the result of a dual purpose. First, he had visited relatives in Peoria, Illinois, and at the time of the accident was With his family enroute to visit the Black Hills; second, he was traveling westward to Seattle so as to arrive in time to report to his new company assignment.

We now turn to the governing law. Boeing emphasizes that its absence of control over Messer at the time of the accident is indicative of his being outside the company’s scope of employment. We deem this argument and authority cited as not germane to the primary issue here. The right of an employer to control the details of an employee’s work accurately tests the existence of a master-servant relationship. Restatement (Second) on Agency § 2 (1958). Here, however, there is no dispute that Messer was the employee of Boeing. The sole and critical issue is whether he was operating within the scope of his employment at the time in question. As stated by the Ninth Circuit in United States v. Romitti, 363 F.2d 662 (9 Cir. 1966): [237]*237Our analysis of Iowa law is that an employer’s control or right to control is inapposite as a basic test of scope of employment. Sandman v. Hagan, 261 Iowa 560, 154 N.W.2d 113 (1967). In Sandman the court observed: “It has been said an act is ‘within the scope of the servant’s employment’ where such act is necessary to accomplish the purpose of the employment and is intended for such purpose, although in excess of the powers actually conferred on the servant by the master.” (Emphasis ours.) Sandman v. Hagan, supra at 117. See also, Seybold v. Eisle, 154 Iowa 128, 134 N.W. 578, 580-581 (1912); United States v. Farmer, 400 F.2d 107, 110-111 (8 Cir. 1968).

[236]*236“The government [argues] * * * the employer exercises no control over the details of the driving, and driving is not a part of the employee’s normal duties.
“In the present case the flat rule which the government suggests would preclude employer liability in circumstances in which the purpose of the rule requires its imposition. Id. at 665.
“[T]he failure of the employer to exercise control over the employee’s driving is a factor of varying importance. Existence of the power to control the physical details of the service may be crucial when the question is whether the actor is an agent or an independent contractor, but may be relatively insignificant in determining whether an admitted agent is acting within the scope of his employment.” Id. at 666.

[237]*237The traditional test in determining scope of employment where personal and business interests jointly motivate the employee is that crafted in Marks’ Dependents v. Gray, 251 N.Y. 90, 167 N.E. 181 (1929), by Judge Cardozo while on the New York Court of Appeals where he stated: “The test in brief is this: If the work of the employee creates the necessity for travel, he is in the course of his employment, though he is serving at the same time some purpose of his own.” This is commonly known as the dual purpose test and has been approved by the Iowa Supreme Court. Golay v. Keister Lumber Co., 175 N.W.2d 385, 388 (Iowa 1970);5 Pribyl v. Standard Electric Co., 246 Iowa 333, 67 N.W.2d 438, 442 (1954); Orris v. Tolerton and Warfield Co., 201 Iowa 1344, 207 N.W. 365, 368 (1926).

Judge Matthes summarized in United States v.

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447 F.2d 234, Counsel Stack Legal Research, https://law.counselstack.com/opinion/merchants-national-bank-v-waters-ca8-1971.