Asphalt & Concrete Services, Inc. v. Perry
108 A.3d 558
Md. Ct. Spec. App.2015Background
- On April 28, 2009, Perry was struck by a dump truck driven by William Johnson and sustained serious injuries; Perry sued Johnson, Higher Power Trucking, LLC (Higher Power), and Asphalt & Concrete Services, Inc. (ACS).
- Perry's original complaint alleged negligence and negligent hiring/supervision, naming Higher Power as Johnson’s employer; discovery showed Higher Power was a forfeited LLC and Perry moved to amend to treat Higher Power as merely a trade name and to allege Johnson was ACS’s agent/employee.
- The court permitted Perry to amend the complaint shortly before trial; ACS contested timeliness and prejudice but the court allowed the amendment and denied motions to dismiss and for summary judgment.
- At trial Perry presented evidence that ACS directly contracted with and directed Johnson for hauls (scheduling, pay, on-site instructions, right to dock pay) and that Johnson’s vehicle registration and liability insurance were invalid and his license suspended at the time of the accident.
- The jury found Johnson was ACS’s agent/employee, ACS negligently hired Johnson, Johnson’s negligence proximately caused Perry’s injuries, and awarded $529,500; ACS appealed arguing (inter alia) erroneous admission of evidence of lack of insurance and other errors.
- The Court of Special Appeals reversed solely because the trial court erred in admitting evidence that Johnson lacked liability insurance, and affirmed the rulings allowing amendment, denying dismissal, and denying judgment as a matter of law on respondeat superior and negligent hiring.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of evidence that Johnson lacked liability insurance | Perry: lack of insurance is relevant to negligent hiring because employer must verify drivers are insured for highway hauling | ACS: insurance lapse was for nonpayment and unrelated to driver competence; evidence irrelevant and highly prejudicial | Court: Evidence of lack of insurance was relevant to competence for highway hauling but no causal link shown between lack of insurance and the accident; admission of lack-of-insurance evidence was erroneous and prejudicial — judgment reversed on this ground |
| Denial of motion to dismiss original complaint | Perry: amendment cured any pleading defects; original complaint supplemented by discovery | ACS: original complaint failed to state a claim against ACS (named only Higher Power) | Held moot — amended complaint superseded the original complaint and became operative |
| Grant of leave to amend (timeliness/statute of limitations) | Perry: amendment did not change operative facts or legal theories; related back to original timely complaint | ACS: amendment came after limitations expired and prejudiced ACS by changing defendant theory | Court: Trial court did not abuse discretion; amendment related back because operative factual pattern remained the same |
| Denial of ACS’s motions for judgment (respondeat superior and negligent hiring) | Perry: sufficient evidence of employment relationship and incompetence (suspended license, no insurance, control over work) to submit to jury | ACS: Johnson was an independent contractor employed by Higher Power; ACS did not exercise sufficient control; alleged unfitness (license suspension, lapsed insurance) unrelated to accident | Court: Viewing evidence in plaintiff’s favor, sufficient evidence existed on agency/control and negligent hiring elements to submit to the jury; denial of judgment proper |
Key Cases Cited
- State v. Simms, 420 Md. 705 (discussing standard of review for relevancy determinations)
- Morris v. Weddington, 320 Md. 674 (insurance evidence inadmissible to prove negligence)
- Henley v. Prince George’s Cnty., 60 Md. App. 24 (employer duty to hire competent employees)
- Latty v. St. Joseph’s Soc. of the Sacred Heart, Inc., 198 Md. App. 254 (elements of negligent hiring/retention)
- Puckrein v. ATI Transport, Inc., 897 A.2d 1034 (N.J. 2006) (where transport is the contract’s core task, lack of registration/insurance is relevant to hauler competence)
- Mavrikidis v. Petullo, 707 A.2d 977 (N.J. 1998) (lack of insurance/financial responsibility not inherently equivalent to incompetence when transport is peripheral)
- McFarland & Son, Inc. v. Basel, 727 So.2d 266 (employment regulatory deficits must be causally connected to accident to support negligent hiring liability)
- TXI Transportation Co. v. Hughes, 306 S.W.3d 230 (Tex. 2010) (evidence irrelevant to negligent hiring if the alleged unfitness did not cause the accident)
- Wankel v. A&B Contractors, Inc., 127 Md. App. 128 (proximate cause analysis: cause in fact and legal cause)
- Whitehead v. Safway Steel Prods., Inc., 304 Md. 67 (factors for determining employer/employee relationship)
- Mackall v. Zayre Corp., 293 Md. 221 (enumeration of master/servant criteria)