Opinion
No. 1:03-cv-0603-JDT-WTL.
September 28, 2004
ENTRY ON CROSS-MOTIONS FOR SUMMARY JUDGMENT, MOTION TO STRIKE AFFIDAVIT
This Entry is a matter of public record and may be made available to the public on the court's web site, but it is not intended for commercial publication either electronically or in paper form. Although the ruling or rulings in this Entry will govern the case presently before this court, this court does not consider the discussion in this Entry to be sufficiently novel or instructive to justify commercial publication or the subsequent citation of it in other proceedings.
This case involves a dispute over insurance coverage. The parties have filed cross-motions for summary judgment, and the Plaintiff has filed a motion to strike an affidavit submitted by Defendant King ("King"). Additionally, Plaintiff urges this court to issue a declaratory judgment pursuant to 28 U.S.C. § 2201 that Defendant Carl Nerding ("Carl") was not acting within the course of his employment at the time of his accident with King. The court essentially must decide in this case whether Plaintiff Employer's Fire Insurance Company ("Employer's") must defend or indemnify Defendants Meridian Magic, Inc. ("Meridian"), doing business as Homes International, Carl, and/or Ron Nerding ("Ron") for an automobile accident Carl had on his way back to Meridian after delivering the mail for the company and briefly stopping at a drug store for personal business. The existence of Employer's liability depends solely on the court's application of the relevant insurance policy, a question of state law. The parties do not dispute that Indiana substantive law governs this case. Alexander v. Erie Ins. Exch., 982 F.2d 1153, 1157 (7th Cir. 1993).
I. BACKGROUND
On May 30, 2002, Carl Nerding, an employee of Meridian, doing business as Homes International, drove a Chevrolet Tahoe leased by his employer to a post office in order to drop off company mail. (Employer's Compl. ¶ 12; Def.'s Mem. Supp. Comb. Resp. Mot. Summ. J. at 4.) Carl, who worked for his father, Ron Nerding, at Meridian while on summer break from college, used the Tahoe without restriction for business and personal trips, twenty-four hours per day, seven days per week. (Def.'s Mem. Supp. Comb. Resp. Mot. Summ. J. at 3-4; Roland Nerding Aff. ¶ 10.) After dropping off the mail, Carl began his return trip to Meridian, where he also kept his residence during the summer. (Carl Nerding Dep. at 10-18.) On his way back, Carl decided to make a detour to an Osco drugstore in order to purchase cigarettes and a soft drink. ( Id. at 15-16.) Upon exiting the Osco's parking lot, Carl collided with a motorcycle driven by King. (Employer's Compl. ¶ 12; Def.'s Mem. Supp. Comb. Resp. Mot. Summ. J. at 4.) The collision occurred in the center lane of a divided four-lane road as Carl was in the process of turning into the road's northbound lanes to begin the trip back to Meridian, but before he had entered those lanes. (Carl Nerding Dep. at 17-18.) Mr. King alleges to have suffered serious bodily injuries as a result of the accident. (Def.'s Mem. Supp. Comb. Resp. Mot. Summ. J. at 4.)
The parties also disagree as to whether the Tahoe was in fact a "leased" vehicle, with the Plaintiff contending that the so-called lease amounts to an actual purchase of the vehicle. This issue will not be reached, as will be noted in the last Section of this Entry.
With respect to his employment at Meridian, Carl testified in a sworn deposition that his job responsibilities included computer work, maintenance work, picking up office supplies, and taking the mail. (Carl Nerding Dep. at 11.) Carl stated he would typically be done for the day during the summer of 2002 when all employees had left. ( Id. at 12.) In a later affidavit, Carl repeated that his workday was typically not completed until he observed that the last employee had left for the day, and added that part of his job responsibilities included being available to respond to business-related emergencies during either the day or evening hours. (Carl Nerding Aff. ¶¶ 10-12.) However, in the earlier deposition, Carl stated that on May 30, 2002 he considered himself to be off work for the day upon dropping the mail at the post office and planned on engaging solely in personal activities upon returning to his residence in the non-business portion of the Meridian complex. (Carl Nerding Dep. at 18-20.) Moreover, Carl resisted the notion that he would have been available for additional work on May 30 after delivering the mail, testifying in his deposition that his employer would have had to "twist his arm" in order to get him to do anything else, and saying only that if a "real emergency" arose he "probably" would have responded. ( Id. at 30-31.)
At the heart of this case is a commercial general liability ("CGL") insurance policy (Policy Number FILH54464) issued by Plaintiff Employer's Fire Insurance Co. ("Employer's") to Meridian that was in full force and effect on the date of the accident between Carl and King. (Employer's Br. Ex. A.) Under the CGL policy, liability arising out of the use of an automobile will be excluded from coverage. ( Id.) Specifically, the CGL policy provides an exclusion for "`Bodily Injury or `Property Damage' arising out of the ownership, maintenance, use or entrustment to others of any aircraft, `auto' or watercraft owned or operated by or rented or loaned to any insured." ( Id.) However, the policy does contain a "Hired Auto Liability" endorsement, modifying the CGL coverage. ( Id.) Pursuant to the hired auto endorsement, coverage will be added for "`bodily injury' or `property damage' arising out of the maintenance or use of a `hired auto' by you or your employees in the course of your business." ( Id.) The endorsement defines "hired auto" to mean "any `auto' you lease, hire or borrow." ( Id.)
The parties do not dispute the terms of either the CGL policy or the hired auto endorsement. Employer's has filed a motion for summary judgment and declaratory judgment that it was under no obligation to defend or indemnify Meridian, Carl Nerding, and/or Ron Nerding. Defendant King then responded and filed a cross-motion for summary judgment that he should be afforded coverage under the applicable policy issued by Employer's to Meridian.
II. Standard for Resolving Cross-Motions for Summary Judgment
The parties seek to dispose of this case through the filing of cross-motions for summary judgment. The purpose of summary judgment is to "pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). Summary judgment is appropriate where the pleadings, depositions, answers to interrogatories, affidavits, and other materials demonstrate that there exists "no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(c). When deciding a motion for summary judgment, the court considers those facts that are undisputed and views additional evidence, and all reasonable inferences drawn therefrom, in the light reasonably most favorable to the nonmoving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Baron v. City of Highland Park, 195 F.3d 333, 337-38 (7th Cir. 1999). On cross motions for summary judgment, each movant must individually satisfy the requirements of Rule 56, ITT Indus. Credit Co. v. D.S. Am., Inc., 674 F. Supp. 1330, 1331 (N.D. Ill. 1987), and the traditional rules for summary judgment will apply even though both parties have moved for summary judgment. Blum v. Fisher and Fisher, Attorneys at Law, 961 F. Supp. 1218, 1222 (N.D. Ill. 1997).
III. Discussion
A. Evidentiary Objections
Employer's has moved to strike the affidavit of Carl Nerding, submitted by King, on the grounds that portions of the affidavit contain statements that conflict with his prior deposition testimony in an attempt to create "sham" issues of material fact to support a denial of Employer's motion for summary judgment. King argues in response that he has never claimed that there are genuine issues of material fact that would preclude this court from granting summary judgment, and that Carl's affidavit was consistent with his prior deposition testimony and offered only to clarify said testimony.
Employer's points to paragraphs 8 and 10 of Carl's affidavit and argues that they contradict Carl's earlier deposition testimony with respect to his work responsibilities and his route to and from Meridian on May 30, 2002. These paragraphs state:
8. That after turning north onto South Madison, I was involved in a collision with a southbound motorcycle, at approximately 4:48 p.m. on May 30, 2002.
10. That as part of my job responsibilities, my workday, including May 30, 2002, was typically not completed until I observed the last employee had left the office at 5110 South Madison Street after 5 p.m.
(Carl Nerding Aff. ¶¶ 8, 10.) Employer's argues that the statement in paragraph 10 contradicts Carl's prior sworn deposition testimony. Carl had testified as follows:
Q. Okay. Now you were headed back — what were you going to do when you got back to [Meridian]?
A. I think I was going to take a nap or something to that effect because I was off for the day, and I was just going to go back into the nonbusiness portion of the building where I was staying and relax.
Q. And if employees were still here when you got back, you would have kept working until the last one left; is that right?
MR. HANNON: Objection, misstates the prior testimony.
A. I would say, no, because they were finishing up, I probably wouldn't have even gone back to the work area to find that out, so probably not because I don't really help them with their jobs so —
Q. But in general, not on the day of the accident, your work hours you testified were not set or normal?
A. Correct.
Q. You'd generally be here [Meridian] until the last person would leave, correct? That's what you testified earlier.
A. Yes, I would generally be around until the last person left.
(Carl Nerding Dep. at 18-19, 35-36).
If an affidavit contradicts the affiant's prior deposition testimony, then the affiant must explain the reason for the discrepancy; otherwise, the contradictory assertion will be entitled to no weight. See Beckel v. Wal-Mart Assocs., Inc., 301 F.3d 621, 623 (7th Cir. 2002); Amadio v. Ford Motor Co., 238 F.3d 919, 926 (7th Cir. 2001) ("[A] party may not attempt to survive a motion for summary judgment by manufacturing a factual dispute through the submission of an affidavit that contradicts prior deposition testimony.") (citation omitted). However, the Seventh Circuit has cautioned that a "definite distinction must be made between discrepancies which create transparent shams and discrepancies which create an issue of credibility or go to the weight of the evidence." Bank of Ill. v. Allied Signal Safety Restraint Sys., 75 F.3d 1162, 1169-70 (7th Cir. 1996) ("the rule applies only to cases in which the statements are inherently inconsistent and in which the contradiction is not the result of an honest discrepancy or newly discovered evidence").
In the instant case, the issue is complicated by the fact that the affiant, Carl Nerding, appears to vary his own testimony throughout the course of the earlier deposition. Employer's is correct to point out that Carl testified that he would not have kept working until the last employee at Meridian finished. However, in an earlier portion of the deposition, Carl stated that he did not have fixed hours, and was typically deemed done for the day "when everybody left." (Carl Nerding Dep. at 12.) Later in the same deposition, Carl again reiterated that he would "generally be around until the last person left," after just testifying that he would not have kept working until the last employee left for the day. ( Id. at 36.) Because of Carl's varied testimony within his own deposition, the court cannot state that his later affidavit, in which Carl provides that his workday was "typically" not completed until he observed the last employee leave, is inherently inconsistent with his prior deposition testimony. (Carl Nerding Aff. ¶ 10.)
However, while the portions of Carl's affidavit regarding his work responsibilities will not be stricken, the court does strike paragraph 8 regarding the exact location of the automobile accident. In his affidavit, Carl states that the collision occurred after he had turned north onto South Madison Street. (Carl Nerding Aff. ¶ 8.) However, in Carl's deposition he testifies that the collision occurred while his vehicle was in the center lane located between the northbound and southbound lanes of Madison, at a point when he was still in the process of turning onto the northbound lanes of Madison. (Carl Nerding Dep. at 17-18.) Carl has not offered any explanation for this discrepancy, and as a result the statement in paragraph 8 of his affidavit is entitled to no weight.
B. Insurance Policy Coverage
Under Indiana law, insurance contracts are subject to the same rules of interpretation as are other contracts. Eli Lilly and Co. v. Home Ins. Co., 482 N.E.2d 467, 470 (Ind. 1985). The "interpretation is primarily a question of law for the court, even if the policy contains an ambiguity needing resolution." USA Life One Ins. Co. of Ind. v. Nuckolls, 682 N.E.2d 534, 538 (Ind. 1997). If the policy language is unambiguous, then it will be given its plain and ordinary meaning. Id. However, if the policy language is ambiguous, the court may apply rules of construction in interpreting the language. Id. If ambiguous, policy language will be strictly construed against the insurer. Id. Policy language will not be considered ambiguous simply because parties offer contrasting interpretations. Id. The policy will be ambiguous "only if it is `susceptible to more than one interpretation and reasonably intelligent persons would differ as to its meaning.'" Id. (citation omitted).
Both parties agree that Employer's will only be liable for bodily injury coverage if the CGL insurance policy's "Hired Auto" Endorsement applies to Carl Nerding's automobile accident. As a threshold matter, however, the parties do dispute whether the hired auto endorsement applies only to permissive users acting in the course of Meridian's business or whether it applies to all permissive users regardless of the nature of their activity. Under Section A of the hired auto endorsement, entitled "Hired Auto Liability," the policy states that "[t]he insurance provided . . . applies to "bodily injury". . . arising out of the maintenance or use of a `hired auto' by you or your employees in the course of your business." (Employer's Br. Ex. A.) Employer's interprets this language to mean that its liability is limited under the policy endorsement to accidents that arise in the course of Meridian's business. Defendant King responds, however, by looking to Section B of the hired auto endorsement, and specifically subsection 3 defining "Who is an Insured." This subsection contains an omnibus provision that extends coverage to "[a]ny other person using a `hired auto' with your permission." ( Id.) King argues that based on the omnibus provision, Employer's hired auto endorsement should cover Carl's accident regardless of whether he was acting in the course of Meridian's business simply because he was a permissive user of the vehicle. The court disagrees.
To apply King's reading of the omnibus provision as extending coverage to any permissive user would be to create coverage that no party intended. King is correct that an omnibus provision does operate to extend coverage to permissive users. See COUCH ON INSURANCE § 111.1 (3d ed. 2004). However, the omnibus provision must adhere to the purpose that the underlying policy was designed to cover. Id. § 111.21 ("any restriction as to the use imposed upon the original insured must also be observed by an additional insured coming within the omnibus clause"). Where a "commercial" general liability policy is in force, as in the instant case, there will be no liability for the insurance company when a covered automobile is used for non-commercial purposes. Id.; see e.g., Kearns Coal Corp., v. United States Fid. Guar. Co., 118 F.2d 33 (2d Cir. 1941). The policy at issue in the instant case is a hired auto endorsement to a commercial general liability insurance policy. Moreover, in the endorsement's description of its hired auto liability coverage it specifically states that it applies only to the use of a hired auto in the course of business. (Employer's Br. Ex. A.) Only after defining the realm of the endorsement's coverage does one determine whether a permissive user qualifies as an "insured person." As such, Employer's will be liable under the policy only if the accident at issue in this case occurred in the course of Meridian's business.
The court's primary responsibility must now be to determine if there are any genuine issues of material fact as to whether Carl Nerding was acting in the course of Meridian's business when he collided with King on May 30, 2002. As an initial matter, the court notes that the phrase "in the course of your business" contained in the hired auto endorsement at issue does not create an ambiguity that would necessitate the court to construe the policy against Employer's. See, e.g., Eli Lilly and Co., 482 N.E.2d at 470-471. The Seventh Circuit has held that the similar phrase, "in the business of," means furthering commercial interests. Liberty Mut. Ins., 55 F.3d at 1335, citing Hartford Ins. Co. of Southeast v. Occidental Fire and Cas. Co. of N.C., 908 F.2d 235, 239 (7th Cir. 1990). More recently, the Second Circuit cited the same Seventh Circuit case for the proposition that "in the course of business" refers to activity that benefits the economic interests of one's employer. Lifson v. INA Life Ins. Co. of New York, 333 F.3d 349, 353 (2d Cir. 2003), citing Hartford Ins. Co. of Southeast, 908 F.2d at 239. Therefore, the court does not need to construe the instant policy against Employer's in order to further the policy's basic purpose of indemnity. Eli Lilly and Co., 482 N.E.2d at 470-471.
But to return to the point, the resolution of the parties' cross-motions for summary judgment will depend on whether Carl Nerding was acting in the course of Meridian's business at the time of the accident. If not, the hired auto endorsement would not apply and Employer's would avoid liability. If Carl was acting in the course of business, Employer's would be liable. Throughout their respective briefs, both sides have relied extensively on the doctrine of respondeat superior and worker's compensation law when addressing the "course of business" issue in this case. While such bodies of law are helpful to the extent that they illuminate the types of activities that Indiana courts consider to be in the course of business, they are not controlling. Liberty Mutual Ins. Co., v. Conn. Indem. Co., 55 F.3d 1333, 1335 (7th Cir. 1995). This is a case solely about the interpretation of a private insurance contract. Id.
In arguing that Carl Nerding acted outside the scope of Meridian's business when he collided with Justin King on May 30, 2002, Employer's advances two primary arguments: (1) that Carl's work day was complete at the time of the accident, and (2) that Carl's detour into the Osco drugstore was for purely personal business. Analogizing to the law of respondeat superior, Employer's notes that under Indiana law, an employee "normally" is not in the service of his employer when he causes an accident while driving to or from work. Biel, Inc. v. Kirsch, 161 N.E.2d 617, 618 (Ind. 1959). In Biel, the Indiana Supreme Court held that an employee who caused an accident in her company car while on the way to work was outside the scope of her employment. Id. Similarly, in Dillman v. Great Dane Trailers, Inc., the Indiana Court of Appeals found outside the scope of employment an employee who caused an accident while driving to his company's Saturday night banquet, at which he was to be the master of ceremonies. 649 N.E.2d 665, 666-67 (Ind.Ct.App. 1995). The Dillman court held that the employee's trip to the banquet on a weekend was no different than going to work at any other time. Id. at 668.
Employer's then turns to worker's compensation law and cites the Indiana Court of Appeals' case of Lockwood v. Bd. of Tr., Speedway Methodist Church, 246 N.E.2d 774 (Ind.Ct.App. 1969). In Lockwood, a church secretary drove the church's minister to an auto repair shop, and on her return trip became involved in an accident while turning into a shopping center's parking lot. Id. at 775. Because the secretary could not remember if she turned into the shopping center for business or personal reasons, the court held that she did not satisfy her burden of proving that the accident arose in the course of her employment. Id.
Based on these cases, Employer's argues that the court must look solely to the nature of Carl's activity at the time of the accident — travel to his place of residence after finishing his last assigned task of the day (dropping of the company mail), with a brief stopover at a drugstore for personal items. Throughout his deposition testimony Carl was emphatic that on the date in question he was "off for the day" after he left the post office, and after leaving the Osco planned to return to the non-business portion of Meridian in order to take a nap or relax. (Carl Nerding Dep. at 18-20.) Carl stated that he had no more job responsibilities after depositing the mail on May 30, 2002, and that he intended to engage solely in personal activities upon returning to Meridian. ( Id. at 20.) He further testified that he stopped at Osco solely for personal items. ( Id.) For these reasons, Employer's contends that Carl was acting outside the scope of his employment at the time of the accident, and should be treated no differently than any other employee who drives home after finishing work for the day.
Defendant King responds that Carl acted in the course of business at the time of the accident because his unlimited use of the Meridian Tahoe was for the company's commercial benefit, he was completing a business errand at the time of the accident, and would have been subject to additional business-related tasks once he returned to the Meridian complex. In support of his contentions, King cites first to the Second Circuit case of Lifson v. INA Life Ins. Co. of New York, 333 F.3d 349 (2d Cir. 2003). In Lifson, a software engineer was killed in an accident after leaving her office in order to pick up her children from daycare and then return home. Id. at 351. As part of her job responsibilities, the engineer in Lifson was required to carry a pager so that she could respond to after-hour computer service calls. Id. At the time of her death, her employer had in effect a group insurance plan that paid benefits for any accident that occurred "in the course of your business," but specifically excluded from coverage employee commuting and "personal deviations." Id. at 351-52. In finding that the employee was acting in the course of her employer's business at the time of her death, the Second Circuit relied primarily on the fact that her home was a place where she could respond quickly to computer service calls by way of a modem attached to her home computer, and that she was actually expecting several such calls on the night of her death. Id. at 353-55. Moreover, the court stressed that the employer benefitted economically from having its engineers work "on-call," which enabled it to reduce the number of necessary paid employees. Id.
King then turns to a line of worker's compensation cases that involve either commuting or errands in which an employee engaged in a mixture of business and personal activity. In Chaney v. Roberts, the Illinois Court of Appeals found within the course of employment an employee's accident that occurred while he was being driven home by his employer after the two men stopped briefly at a tavern for personal business. 475 N.E.2d 55, 59 (Ind.Ct.App. 1985). The court rested its holding primarily on the fact that the employer-provided transportation home was specifically included as part of the injured employee's employment benefits package. Id. King also cites U.S. Fiber Glass Indus. v. Uland, in which an employee died in a plane crash while returning home from a sales meeting held in conjunction with a college football game. 206 N.E.2d 385, 388 (Ind.Ct.App. 1965). Applying the so-called "dual purpose trips" doctrine, the Uland court held that the employee's death was within the course of his employment for worker's compensation purposes because he would not have made the trip to attend the football game but for the related business meeting. Id.; see also Keller v. H.P. Wasson Co., 153 N.E.2d 386, 388 (Ind.Ct.App. 1958) ("There is an exception to the general rule, in that, an employee, while he is performing, or is on his way home from performing, or is on his way from his home to perform some special service or errand, or some duty incidental to the nature of his employment in the interest of, or under the direction of his employer, sustaining an accidental injury, is considered to have suffered an injury arising out of and in the course of his employment."). King attempts to distinguish Lockwood from the instant case by noting that in Lockwood, the employee was injured while turning into a shopping center, whereas Carl was involved in his accident while exiting a drugstore en route back to his employer's complex, albeit the residential portion of that complex.
Finally, King, too, analogizes the instant case to cases applying the doctrine of respondeat superior. In Gullett v. Smith, the Indiana Court of Appeals held that there were genuine issues of fact precluding summary judgment as to whether a city superintendent was acting within the scope of his employment with the city when he became involved in an automobile accident with the plaintiffs. 637 N.E.2d 172, 175 (Ind.Ct.App. 1994). Despite the fact that the employee in Gullett had ended his regular working day with the city at the time of the accident and was on his way to his second job, the court premised its holding on the fact that he was on-call twenty-four hours a day with the city and was provided at all times with a city-owned vehicle. Id. The court notes, however, that Gullett recognized its holding to be an exception to the general rule that an employee is not within the scope of his employment when traveling to and from work, suggesting that Gullett should be limited to its own facts. Id. at 175 n. 3. In State v. Gibbs, an employer furnished a car to its employee for business-related use only. 336 N.E.2d 703, 704 (Ind.Ct.App. 1975). Despite finishing work at 5:00 p.m. each day, the employee was considered to be on-call twenty-four hours per day. Id. Under these facts, the Gibbs court held that the employee was acting in the course of his employment when he was involved in an accident while driving home at around 10:00 p.m., stressing the considerable amount of driving that the employee's job entailed and the fact that he was always on-call. Id. at 705-06. Similarly, in Gibbs v. Miller an employer was held liable for an accident that occurred when the company's traveling salesman became involved in an accident while on his way home for lunch during his lunch hour. 283 N.E.2d 592, 595 (Ind.Ct.App. 1972). The court noted that the salesman used his own car to make his rounds, had just finished making several appointments before lunch, had appointments scheduled for later in the afternoon on the date of the accident, and often did paperwork at home. Id. at 594-95.
Based on the foregoing cases, King argues that as long as Carl was involved in the accident after completing a company task and while he had unlimited and unrestricted use of a company-leased vehicle, he was acting within the course of business. Moreover, King posits that Carl's work day was not yet finished at the time of the accident because he would have been subject to more tasks upon his return to the Meridian complex and was expected to respond to business emergencies no matter when they occurred, even if after normal working hours. As for commuting, King argues that the trip from the post office back to Meridian should not be considered part of Carl's normal commute, since his normal commute was merely a short walk from the business area of Meridian over to the non-business area.
After carefully scrutinizing the myriad of state employment and insurance law cases cited by the parties, as well as many cases not cited by either side, the court finds support within Indiana law for Employer's position that Carl was acting outside the scope of Meridian's business at the time of the accident. In Empire Fire and Marine Ins. Co. v. Midwestern Indem. Co., the Indiana Court of Appeals upheld a grant of summary judgment in favor of an insurance company whose policy provided coverage for accidents occurring while a truck driver's truck was being used for business purposes. 402 N.E.2d 998, 999-1000 (Ind.Ct.App. 1980). In that case, the insured trucking company had leased the driver a truck for the purpose of making a delivery of steel. Id. at 998. Following the delivery, the driver stopped at a tavern, and then became involved in an accident while on his way home from the tavern. Id. at 998-99. The driver answered a request for admission to the effect that he was on his way home when the accident occurred. Id. at 999. However, in a later deposition the driver stated that he could not remember if he was heading home or whether he was returning to the trucking company's headquarters. Id. Based on these facts it was important to the Empire court that the driver had completed his delivery at the time of the accident and admitted to be heading home. Id. In making its decision, the court relied extensively on Pace v. Couture, another case involving an accident committed by a commercial truck driver. 276 N.E.2d 213 (Ind.Ct.App. 1971). In Pace, the driver and his truck were under an exclusive control lease to Southern Express. Id. at 214. After the driver made a delivery in Illinois, he was informed by his dispatcher that he did not have any further deliveries to make, and that he should return home. Id. The driver then headed towards his home in South Bend, Indiana, but while en route he became involved in an accident. Id. In affirming a grant of summary judgment to Southern Express based on its finding that the driver was not acting in the course of business at the time of the accident, the court of appeals cited the familiar Indiana common law rule that an employee on his way home from work is normally not in the employment of his employer. Id. at 218-19.
The Seventh Circuit's analysis of both Empire and Pace proves enlightening:
[T]he truckers [in Empire and Pace] either had completed their deliveries or were not assigned any deliveries when their accidents occurred. They went home because there was nothing else to do and the companies to whom they leased their trucks and services instructed them only to call later to see if there were any deliveries to be made.Liberty Mut. Ins. Co., 55 F.3d at 1337. The Seventh Circuit set forth such an analysis in its own case applying Indiana law to determine whether an accident occurred during the course of business. Id. at 1334. In Liberty Mutual, Connecticut Indemnity insured a truck driver for accidents the might occur when he was "bobtailing," parlance for driving one's truck without a trailer and while not working for anyone else. Id. at 1334. The driver in that case became involved in an accident while on his way to resume delivering a trailer for Gra-Bell Truck Line, Inc. The driver had been instructed by Gra-Bell to transport a load of cereal from Michigan to Ohio. Id. After he picked up the load, the driver stopped at a truck stop in Indiana, where he proceeded to unhook his trailer from the truck and leave it at the truck stop. Id. The driver then logged off duty and drove his truck to his nearby home, an action authorized by Gra-Bell. Id. at 1334-35. Upon leaving his home, the driver headed back towards the truck stop so that he could pick up his trailer and proceed to Ohio with the shipment. Id. at 1335. However, before he reached the truck stop, the driver was involved in an automobile accident. Id. The issue before the court was whether the accident occurred "while in the business of anyone to whom [the truck] is rented;" if so, Connecticut Indemnity would not be liable under its policy with the driver. Id. In finding for Connecticut Indemnity, and that the accident occurred while the driver was in the business of Gra-Bell, the court premised its holding on the fact that the driver was under instructions from Gra-Bell regarding a specific delivery and had been authorized to determine the best route for the delivery, even if that route meant a brief stopover at the driver's home for a rest. Id. at 1337-38. Gra-Bell had the ultimate responsibility and control over the driver's delivery, and he was in the middle of carrying out the company's orders when the accident occurred. Id.
The court finds Pace and Empire more closely analogous to the present case. Carl testified during his sworn deposition that after he dropped off his employer's mail on May 30, 2002 he considered himself off for the day, and that upon exiting the Osco he planned to return to the non-business area of the Meridian complex — his residence for the summer — in order to engage solely in personal activities. (Carl Nerding Dep. at 18-20.) No matter what his general schedule might have been during the summer of 2002, Carl testified that on the exact day of the accident he had no plans to continue working after he dropped the mail at the post office. Unlike the driver in Liberty Mutual, Carl did not make a personal stop on his way to resume making a delivery; rather, Carl had finished for the day and was heading to his personal residence when the accident occurred. Similarly, unlike the traveling salesman in Gibbs v. Miller, who had other appointments scheduled for the afternoon on the day of his accident, Carl testified that he had finished his assigned tasks at the time of his collision with King. Applying the general rule in Biel that an employee is not considered to be within the course of employment while driving to and from work, Carl's return trip from Osco appears to be no different than any other employee's trip home after a day of work. 161 N.E.2d at 618. Furthermore, the court can discern no significance in the fact that Carl's employer provided him with the unrestricted use of a vehicle. In both the Biel case and City of Crawfordsville v. Michael, 479 N.E.2d 102 (Ind.Ct.App. 1985), the Indiana courts found activity to be outside the course of business despite the fact that employees caused accidents while driving employer-provided automobiles.
A closer question is presented by King's argument that Carl's accident occurred during the course of his employment because his job required him to be ready to respond to after-hour business emergencies. In this respect King urges the court to analogize to those cases in which employees have been found to be within the course of employment despite committing accidents while on personal business because they were required by their employers to be "on-call" twenty-four hours per day. However, those cases also are distinguishable from the instant case. For example, the employee in Lifson was a full-time member of the company's technical staff and required to wear a pager so that she could respond quickly to any emergency. 333 F.3d at 351. Moreover, on the date of her death, the company was fully expecting the employee to field several emergency calls. Id. at 354. Likewise in Gullett, the employee's job responsibilities required him to be on-call twenty-four hours per day, and to that end he was required to carry a pager and handheld radio at all times. 637 N.E.2d at 173-74; see also Gibbs, 336 N.E.2d at 705 (holding that accident occurring while employee driving home was within course of employment where employee's job entailed considerable driving and employee on-call twenty-four hours per day). In the instant case, despite Carl's statement in his affidavit that Meridian provided him with a vehicle in order to respond to emergencies, he testified at his deposition as follows:
Q: But if your father had had some work that needed to be done despite your intent to call it a day, would that have been something that you would have undertaken and completed?
MR. HANNON: And I'm going to object to that hypothetical question.
A. You know, I suppose he could have twisted my arm hard enough to get me to do something.
Q. Okay. So I guess the answer would be, yes, if the computers were down or if there needed to be another trip that was made before 5:00 o'clock, that you would have probably completed it?
A. If it had been a real emergency, I probably would have done it.
Q. Okay. So, in other words, until 5:00 o'clock on that Thursday, you would be available for work if there was work for you to do?
A. If it would have been a real emergency. I mean, but, you know, normally after having worked a long day, you know, and everybody has gone home, you know, that was — would have been a very rare, uncommon situation for something like that to happen. But the answer is yes.
(Carl Nerding Dep. at 30-31.) King offers no evidence that Carl was provided with a pager or that he was considered to be "on-call" twenty-four hours per day; rather, Carl's deposition testimony implies that even if an emergency arose after other employees had finished for the day his employer would have had to "twist" his arm to get him to respond. Though his sheer presence in the residential portion of Meridian may have enabled him to respond to emergencies in the business area of the complex, nothing in his testimony reveals that he was subject to the same or similar twenty-four per day on-call responsibility as that required of the employees in cases such Lifson, Gullett, or Gibbs. Moreover, unlike the employee in Lifson, Carl's testimony indicates that he did not expect to receive any after-hour emergency calls on May 30, 2002, and that such emergencies would have been "very rare." ( Id. at 31.)
The court finds the parties' analogies to the respondeat superior doctrine to be more instructive in the instant case than those cases applying worker's compensation law. First, unlike the common law areas of respondeat superior and contract interpretation, worker's compensation law is a creature of statute. Under the Indiana Worker's Compensation Act, payment of compensation is authorized to employees for "personal injury or death by accident arising out of and in the course of employment." IND. CODE § 22-3-2-2(a) (2004). An "injury `arises out of' employment when a causal nexus exists between the injury sustained and the duties or services performed by the injured employee." Milledge v. The Oaks, 784 N.E.2d 926, 929 (Ind. 2003) (citation omitted). "An accident occurs `in the course of business' when it takes place within the period of employment, at a place where the employee may reasonably be, and while the employee is fulfilling the duties of employment or while engaged in doing something incidental thereto." Id. Both the "in the course of business" and "arising out of employment" prongs must be satisfied for compensation to be awarded. Id. However, unlike the respondeat superior framework, and for the purposes of this case, the law of contract interpretation, the Worker's Compensation Act is to be "construed liberally" in favor of employees, "so as not to negate the Act's humane purposes." Id. at 933 (citation omitted). Such deference to employees makes reliance on worker's compensation cases for the purposes of interpreting the contract language of "in the course of business" in the instant case problematic.
IV. Conclusion
The evidence offered by the parties in this case conclusively reveals that Carl Nerding had finished work on May 30, 2002, after dropping off his employer's mail at the post office and was engaged in purely personal business at the time of his accident with Defendant King. Based on these facts, the court declares that Carl Nerding was acting outside the course of Meridian Magic, Inc.'s business at the time of his accident, and therefore that Plaintiff was under no obligation to defend or indemnify Meridian Magic, Inc., Ron Nerding, and/or Carl Nerding. For all the foregoing reasons, Plaintiff's motion for summary judgment will be GRANTED and Defendant King's motion for summary judgment is hereby DENIED.
Because the court has held that Carl Nerding was acting outside the course of business at the time of his accident with Defendant King, the court has no need to consider whether the vehicle he was driving at the time should be defined as a "hired auto."
ALL OF WHICH IS ENTERED.