In this informative piece, Christopher T. McGrath, Esq. describes the circumstances under which a business may become liable for the actions of a driver, even if the driver is not a direct employee.
Many New York attorneys are unaware that a business that hires a vehicle and driver from a second business may become vicariously liable for the driver’s conduct even though it is not the driver’s general employer.
By way of background, in New York State it is well settled that, even where a worker is in the general employ of one entity, the worker may be transferred for a limited time to the service of another, in which event the worker becomes the “special employee” of the other.[1]
Where such a special employment relationship exists, the special employer is responsible in tort, under the doctrine of respondeat superior, for the negligence of the borrowed worker.[2]
Although there are many factors that may collectively bear on whether an entity is or is not a borrowed worker’s special employer, New York’s highest court, known as the Court of Appeals, recently reaffirmed that a “significant” and “weighty” factor in deciding whether such a relationship exists is whether the purported special employer in fact controlled “the manner, details and ultimate result of the employee’s work.” Fung v. Japan Airlines Company, Ltd., 9 N.Y.3d 351, 359, 850 N.Y.S.2d 359, 364 (2007) (“Although no one factor is determinative, a ‘significant’ and ‘weighty feature’ in deciding whether a special employment relationship exists is ‘who controls and directs the manner, details and ultimate result of the employee’s work’ in other words, who determines ‘all essential, locational and commonly recognizable components of the [employee’s work relationship,’” quoting Thompson, 78 N.Y.2d at 558, 578 N.Y.S.2d at 109); Graziano v. 110 Sand Company, 50 A.D.3d 635, 636, 855 N.Y.S.2d 203, 205 (2nd Dep’t 2008) (“[a]lthough many factors are weighed in deciding whether a special employment relationship exists, courts have focused on the ‘significant and weighty’ fact or of ‘who controls and directs the manner, details and ultimate result of the employee’s work,’” quoting Thompson, 78 N.Y.2d at 558, 578 N.Y.S.2d at 109).
The “Borrowed Driver” case occurs when a business, lacking sufficient drivers or vehicles of its own, leases a vehicle and driver from another. In such instance, while the driver’s true or general employer (the one who pays the driver’s salary) will still remain vicariously liable for the driver’s conduct, the hirer may also stand vicariously liable in its capacity as “special employer.”
There are exceptions. Vicarious liability will not lie if the hirer is really a consumer and not a business (e.g., an individual who calls an agency/employer for a chauffeur).[3] Also, where the hirer merely hires the driver (or the driver’s general employer) to go from Point A to Point B without interfering with the manner or means by which that task is accomplished, that too will not be deemed a special employer relationship.[4]
However, in the far from uncommon case in which a business leases a vehicle-and-driver for purposes of the business and in which the lessee does direct the details of the driver’s day-to-day activities, the courts have time and again held that there is, at the least, a question of fact as to whether the driver thus became the hirer’s special employee.[5] Indeed, the situation of the Borrowed Driver has recurred so frequently in the case law that the Appellate Division for the Third Department long ago characterized it as the “classic” example of special employment.[6]
New York attorneys with experience in handling car accident cases take heed: the driver’s employer is sometimes not the only employer that stands responsible for the driver’s conduct. The existence of a second responsible party may have significant impact upon the availability of insurance and assets to compensate a person injured in an accident.
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1 Thompson v. Grumman Aerospace Corporation, 78 N.Y.2d 553, 557, 578 N.Y.S.2d 106, 108 (1991) (“A special employee is described as one who is transferred for a limited time of whatever duration to the service of another”); Navarrete v. A&V Pasta Products, Inc., 32 A.D.3d 1003, 1004, 821 N.Y.S.2d 268, 269 (2nd Dep’t 2006) (“‘A special employee is described as one who is transferred for a limited time of whatever duration to the service of another,’” quoting Thompson, supra); Bounds v. State of New York, 24 A.D.3d 1212, 1213, 809 N.Y.S.2d 314, 315 (4th Dep’t 2005) (same); Ribeiro v. Dynamic Painting Corporation, 23 A.D.3d 795, 795-796, 803 N.Y.S.2d 754, 755 (3rd Dep’t 2005), lv. den., 6 N.Y.3d 707, 812 N.Y.S.2d 37 (2006) (same); Gannon v. JWP Forest Electric Corporation, 275 A.D.2d 231, 231-232, 712 N.Y.S.2d 494, 495 (1st Dep’t 2000) (same); Holt v. Welding Services, Inc., 264 A.D.2d 562, 564, 694 N.Y.S.2d 638, 640 (1st Dep’t 1999), app. dsmd., 94 N.Y.2d 899, 707 N.Y.S.2d 143 (2000) (same).
2 Schmedes v. Deffaa, 214 N.Y. 675 (1915); Holt v. Welding Services, Inc., 264 A.D.2d 562, 564, 694 N.Y.S.2d 638, 640 (1st Dep’t 1999).
3 McNamara v. Leipzig, 227 N.Y. 291, 293, 296 (1919).
4 Charles v. Barrett, 233 N.Y. 127, 128-129 (1922).
5 Stone v. Bigley Bros., Inc., 309 N.Y. 132 (1955); Hughes v. Tishman Construction Corp., 40 A.D.3d 305, 310, 836 N.Y.S.2d 86, 91 (1st Dep’t 2007); Bugaj v. Great American, 20 A.D.3d 612, 613, 615, 798 N.Y.S.2d 529, 530-531, 532 (3rd Dep’t 2005); Mehar v. Skyline Credit Ride, Inc., 301 A.D.2d 808, 753 N.Y.S.2d 593 (3rd Dep’t 2003); McGreevey v. Jameson, 300 A.D.2d 897, 898, 752 N.Y.S.2d 412, 414 (3rd Dep’t 2002); Tunison v. P.C. Richards & Son, 257 A.D.2d 856, 684 N.Y.S.2d 311 (3rd Dep’t 1999); Cybulski v. Bethlehem Steel Corporation, 247 A.D.2d 915, 915, 668 N.Y.S.2d 420, 421-422 (4th Dep’t 1998); Totoli v. Domtar, Inc., 229 A.D.2d 934, 645 N.Y.S.2d 367, 368 (4th Dep’t 1996); Brooks v. Chemical Leaman Tank Lines, Inc., 71 A.D.2d 405, 407-408, 422 N.Y.S.2d 695, 697-698 (1st Dep’t 1979); Donoghue v. DeCarolis, 15 A.D.2d 602, 602, 222 N.Y.S.2d 398, 399-400 (3rd Dep’t 1961).
6 Mann v. Weaver, 27 A.D.2d 681, 682, 276 N.Y.S.2d 159, 161 (3rd Dep’t 1967) (where truck’s lessee “dispatched decedent [the truck’s driver] and, among other personal contacts, received his reports directly,” finding that the lessee was decedent’s special employee was supported by substantial evidence; “Indeed, this may well be considered a classic example of a general employer special employer situation”).
Christopher T. McGrath, Esq – New York attorney