Sperl v. C.H. Robinson Worldwide ( 2011 )

No. 3--09--0830
Opinion filed March 30, 2011
_________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
THIRD DISTRICT
A.D., 2011
SUSAN D. SPERL, Individually ) Appeal from the Circuit Court
and as Executor of the Estate ) of the 12th Judicial Circuit,
of Joseph G. Sperl, Deceased, ) Will County, Illinois,
)
Plaintiff-Appellee, )
)
v. )
)
C.H. ROBINSON WORLDWIDE, INC., )
)
Defendant-Appellant )
)
(C.H. Robinson Worldwide-Ltl, )
Inc., C.H. Robinson Company, )
Inc., d/b/a C.H. Robinson )
International, Inc., DeAn J. )
Henry, Toad L. Dragonfly )
Express, PBX, Inc., d/b/a Tyson )
Food Logistics, a Foreign )
Corporation, Tyson Fresh Meats, )
Inc., a Foreign Corporation and )
Michael R. Smith, )
)
Defendants). )
_______________________________ )
)
WILLIAM TALUC and SKYE TALUC, )
)
Plaintiffs-Appellees, )
)
v. )
)
C.H. ROBINSON WORLDWIDE, INC., )
and C.H. ROBINSON COMPANY, )
)
Defendants-Appellants ) Nos. 04--L--428, 05--L--812,
) 09--L--005
(C.H. Robinson Company, Inc., )
C.H. Robinson International, )
Inc., C.H. Robinson Worldwide- )
Ltl, Inc., DeAn Henry, )
Individually and d/b/a DJ )
Transport, Michael R. Smith, )
Individually and d/b/a Toad L. )
Dragon Fly Express, Luann G. )
Whitener-Black, Individually )
and d/b/a Toad L. Dragonfly )
Express, )
)
Defendants). )
_______________________________ )
)
ANNETTE SANDERS, Individually )
and as Administrator of the )
Estate of Thomas S. Sanders, )
Deceased, )
)
Plaintiff-Appellee, )
)
v. )
)
C.H. ROBINSON WORLDWIDE, INC., )
and C.H. ROBINSON COMPANY, )
(referred to as C.H. Robinson )
Worldwide), )
)
Defendants-Appellants )
)
(C.H. Robinson International )
Inc., C.H. Robinson Company, )
Inc., C.H. Robinson Company, LP,)
C.H. Robinson Worldwide )
Foundation, DeAn J. Henry, )
Luann G. Whitener-Black and )
Michael R. Smith, Individually )
2
and d/b/a Toad L. Dragonfly )
Express, ) Honorable
) James E. Garrison,
Defendants). ) Judge, Presiding.
________________________________________________________________
JUSTICE LYTTON delivered the judgement of the court, with
opinion.
Justices Holdridge and McDade concurred in the judgment and
opinion.
_________________________________________________________________
OPINION
Plaintiffs, Susan Sperl, individually and as the executor of
the estate of Joseph Sperl; Annette Sanders, individually and as
the administrator of the estate of Thomas Sanders; and William and
Skye Taluc, filed a complaint against, among others, defendant C.H.
Robinson Worldwide, Inc., a/k/a C.H. Robinson Company (CHR), for
wrongful death and personal injuries they sustained due to DeAn
Henry’s negligent operation of a tractor-trailer. The jury
concluded that CHR was vicariously liable based on agency and
entered judgment in favor of plaintiffs in the amount of
$23,775,000. The trial court denied CHR’s motion for judgment
notwithstanding the verdict (judgment n.o.v.) or a new trial. On
appeal, CHR claims that (1) the evidence failed to establish an
agency relationship, and (2) the trial court erred in refusing to
allocate fault with Henry and her employer, Luann Whitener-Black,
3
d/b/a Toad L. Dragonfly Express (Dragonfly). We affirm.
On the morning of April 1, 2004, Henry was driving a tractor-
trailer containing a load of potatoes from Idaho to CHR’s warehouse
in Bolingbrook, Illinois. As she approached Plainfield, traveling
on Interstate 55, she noticed that the vehicles ahead of her were
not moving. Henry was unable to stop her truck and ran over
several vehicles, causing a multiple-car accident. Joseph Sperl
and Thomas Sanders died in the collision, and William Taluc
sustained serious injuries. Henry owned the tractor she was
driving and leased it to Dragonfly, a motor carrier. On that day,
Henry was delivering a load for CHR.
Plaintiffs sued Henry, Dragonfly and CHR for wrongful death
and personal injuries sustained as a result of Henry's negligence.
Henry and Dragonfly admitted liability. CHR denied liability and
sought contribution from Henry and Dragonfly.
At trial, the evidence revealed that CHR is a logistics
company that provides a variety of transportation-related services.
It is a federally licensed freight broker. At the time of the
accident, it was not a licensed motor carrier. CHR does not own
tractor-trailers, nor does it employ drivers. Instead, CHR sells
its services to customers or shippers needing to transport goods
and then contracts with carriers to provide transportation for its
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customers.
A network of federally licensed carriers hauls freight,
primarily perishable products, for CHR and its customers.
Dragonfly is one of those carriers. In March of 2002, Dragonfly
and CHR entered into a contract carrier agreement that was standard
for the industry. It provided that CHR was exclusively liable for
Dragonfly's freight charges; CHR's customers had no obligation to
pay Dragonfly. Dragonfly agreed that all transportation provided
to CHR would be performed under the contract. It warranted that it
would use competent drivers. Dragonfly also warranted that neither
CHR nor its customers were responsible for the drivers' salaries,
wages, charges, or worker's compensation expenses. The contract
described the relationship between the parties as follows:
"The parties understand and agree that the relationship
of Carrier to Robinson [CHR] hereunder is solely that of
an independent contract and that Carrier shall and does,
employ, retain or lease on its own behalf all persons
operating motor vehicles transporting commodities under
this Contract."
Once a carrier signed a contract carrier agreement, it could
begin to haul loads for CHR. Upon arranging a delivery, CHR issued
a load confirmation sheet (LCS) for the load. The LCS identified
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the carrier, driver, product and rate. It also included any
special instructions that applied to the load.
In 2004, Jewel Food Stores began remodeling its supermarket
distribution center and searching for an alternative warehouse that
could temporarily distribute its perishable products. Jewel
representatives knew that CHR was a federally licensed seller of
produce and fruit and could handle special projects. CHR was able
to offer multiple temperature storage capabilities and could
transport perishable items to Jewel's stores. As a result, Jewel
entered into a delivery contract with CHR in which CHR purchased
produce for Jewel, stored it, and then arranged for transportation
to Jewel's various grocery stores.
Henry owned her semi-tractor and leased it to Dragonfly. In
the spring of 2004, Dragonfly gave Henry permission to use its
carrier authority to book and deliver loads on her own. If Henry
booked a load, she kept all the profit. If Dragonfly dispatched
Henry, Dragonfly kept 5%.
On March 29, 2004, Henry called Troy Pleasants, a
transportation manager in CHR's Bolingbrook office, and requested
a load. Pleasants offered a load of potatoes that CHR had recently
purchased in Idaho. The potatoes were to be loaded and delivered
to CHR's Bolingbrook warehouse, where they would be repackaged and
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shipped to various Jewel grocery stores. Pleasants stated that CHR
required a refrigerated trailer that measured at least 48 feet in
length for the job. Henry accepted the load for a payment of
$1,800, less a $700 advance for fuel.
CHR sent Dragonfly an LCS confirming the shipment. At the top
of the LCS, in bold-face type, it stated: "Driver must call Troy
Pleasants for dispatch." Under the subheading "DRIVER SPECIAL
INSTRUCTIONS", it listed the following requirements:
"1. Driver must make check calls daily by no later
than 10 am CST daily or $50 will be deducted from the
rate.
2. Driver must verify package count and/or pallet
count being loaded on the truck.
3. Driver may incur a fine of $500 for being a full
day late, without any proof of breakdown.
4. Driver may incur a fine of $250 for being late
for an appt time.
5. Driver must stay in constant communication with
me throughout entire load.
6. Driver may incur a fine, if he does not call,
for any of the following reasons
a.) waiting longer than 2 hours for product
7
***
7. Driver must call after each pick up and verify
that he is loaded.
8. FAILURE TO NOTIFY FINE: If driver has a 7 am
appt for that day of delivery, and has a problem that
delays him to make on time delivery, and we do not
receive a phone call until after or at the time of the
delivery appt:
a.) The carrier will be fined $250
b.) The carrier could also be
responsible to cover the loss sales
and cost to cover the customer
product for that day.
***
9. Driver must pulp all product being loaded on the
truck. If pulp temperature is plus or minus 2 degrees
from the temperature on the dispatch sheet, driver must
call their CH Robinson Representative ASAP.
10. All Drivers must check call the day before
delivery no matter what day it is. If the driver is more
than 700 miles out at or before 10 CST driver must check
call again at 4 PM. Any driver 700 miles out after 10 am
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CST MUST check call at 4 PM CST, and again at 10 PM CST
the *** before delivery.
* * * Most importantly, the DRIVER must stay in
constant communication with Central Product and/or the
night crew service."
At trial, Henry testified that Dragonfly did not dispatch her
regarding the load; she contacted Troy Pleasants directly looking
for a load to deliver. Henry further testified that she was in
constant contact with CHR dispatch throughout her trip. She called
Pleasants, or another member of his phone team, five times during
her trip, sometimes calling multiple times within a single day.
During each phone conversation, Pleasants asked Henry about her
location and about the temperature and integrity of the load.
Henry stated that, although she did not see the LCS for the load of
potatoes, she was aware of the fines CHR could impose because she
had worked with CHR in the past. She knew that CHR's fines ranged
from $50 to $500 and that multiple fines could be imposed. She was
also aware that if she was late delivering a load, a fine would be
imposed. Henry testified that she would do "everything [she]
could" to avoid a fine. Federal regulations only allowed Henry to
drive 10 hours each day. CHR's schedule put pressure on Henry as
a driver. Henry stated that, given the amount of time she had to
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get to Illinois, she would not have been able to deliver the load
to the Bolingbrook warehouse within CHR’s schedule without
violating federal regulations.
On cross-examination, Henry testified that CHR did not
instruct her on how to get from Idaho to Bolingbrook. She made the
decision to take Interstate 80 to Interstate 55, but she called CHR
for directions when she was close to the warehouse. She also
testified that had she successfully delivered the potatoes, CHR
would have directly deposited the payment into her personal account
at Transport Alliance Bank.
Pleasants testified that after talking to Henry on March 29,
he filled in the driver's name as "DeAn" on the dispatch sheet and
faxed a copy of the LCS to Dragonfly. According to the LCS, Henry
was required to stay in constant contact with CHR during delivery.
CHR imposed fines on the drivers to ensure timely delivery of a
load. He was not surprised that Henry would not make any money on
the trip if she followed federal regulations.
Plaintiffs' expert Whitney Morgan agreed that CHR was
generally a freight broker but stated that CHR's conduct in this
case "also fell outside that definition and into the definition of
a motor carrier." Morgan noted that CHR dealt directly with Henry
and that if Henry successfully delivered this load, she would be
10
paid directly by CHR. In addition, Henry received a fuel advance
from CHR. Morgan noted that Dragonfly did not dispatch Henry. She
believed that, for this load, CHR was acting as a motor carrier
with respect to dispatch, management and supervision of the load.
CHR trucking expert Michael Napier testified that carriers and
brokers dispatch in different ways. Carriers dispatch to determine
driver conditions, hours of service, tax obligations and driver
qualifications. By contrast, a "broker" dispatches to monitor load
characteristics. He opined that CHR acted as a broker in this
case, noting that CHR's special instructions and fines were not
unusual in the industry.
At the close of the evidence, CHR moved for a directed verdict
on the issue of agency. The trial court denied defendant's motion.
The jury then returned three general verdicts in favor of
plaintiffs. It specifically found that Henry was an agent of CHR
at the time of the accident, making defendant vicariously liable
for plaintiffs' injuries under the doctrine of respondeat superior.
The court entered judgment against CHR. CHR filed a posttrial
motion for judgment n.o.v. or, in the alternative, a new trial,
which was denied.
STANDARD OF REVIEW
A judgment n.o.v. is properly entered where all the evidence,
11
viewed in a light most favorable to the opponent, so overwhelming
favors the moving party that no contrary verdict based on that
evidence could ever stand. Pedrick v. Peoria & Eastern R.R. Co.,
37 Ill. 2d 494 (1967). In ruling on a motion for judgment n.o.v.,
the court does not weigh the evidence or reassess the witnesses'
credibility. Maple v. Gustafson, 151 Ill. 2d 445 (1992). A trial
court should not enter judgment n.o.v. if there is any evidence
establishing a substantial factual dispute or the determination
regarding conflicting evidence is decisive to the outcome of the
trial. Maple, 151 Ill. 2d at 454. Although we apply a de novo
standard of review to the denial of a motion for judgment n.o.v.,
the Pedrick standard applies on appeal as well. Jones v. Chicago
Osteopathic Hospital, 316 Ill. App. 3d 1121 (2000).
In contrast, on a motion for a new trial, the trial court will
weigh the evidence and order a new trial if the verdict is contrary
to the manifest weight of the evidence. Maple, 151 Ill. 2d at 454.
A verdict is against the manifest weight of the evidence only where
the opposite result is clearly evident or where the jury's finding
is unreasonable, arbitrary or not based on the evidence. Maple,
151 Ill. 2d at 454. We will not reverse the court's ruling on a
motion for a new trial unless it is affirmatively shown that the
trial court clearly abused its discretion. Id. at 455.
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ANALYSIS
I. Agency Relationship
CHR argues that the trial court should have granted its motion
for judgment n.o.v. or a new trial because the evidence did not
support the jury's finding that a principal-agent relationship
existed between CHR and Henry. Specifically, it claims that the
evidence overwhelmingly demonstrated that Henry was an independent
contractor and that CHR had no right to control her actions in
transporting the load of potatoes.
Generally, a person injured by the negligence of another must
seek his or her remedy from the person who caused the injury.
Darner v. Colby, 375 Ill. 558 (1941). The principal-agent
relationship is an exception to this general rule. Woods v. Cole,
181 Ill. 2d 512 (1998). Under the doctrine of respondeat superior,
a principal may be held liable for the negligent actions of an
agent that caused a plaintiff's injury, even if the principal does
not himself engage in any conduct in relation to the plaintiff.
Woods, 181 Ill. 2d at 517.
A principal is vicariously liable for the conduct of its agent
but not for the conduct of an independent contractor. Petrovich v.
Share Health Plan of Illinois, Inc., 188 Ill. 2d 17 (1999). The
difference is defined by the level of control over the manner of
13
work performance. Horwitz v. Holabird & Root, 212 Ill. 2d 1
(2004). An agency is a consensual relationship in which a
principal has the right to control an agent's conduct and an agent
has the power to affect a principal's legal relations. Resolution
Trust Corp. v. Hardisty, 269 Ill. App. 3d 613 (1995). An
independent contractor relationship is one in which an independent
contractor undertakes to produce a given result but, in the actual
execution of the work, is not under the order or control of the
person for whom he does the work. Horwitz, 212 Ill. 2d at 13.
A fact finder’s determination of whether an agency
relationship exists should be made by considering all of the
surrounding circumstances and actions of the parties, without
exclusive weight being given to contractual labels or provisions.
See Roberson v. Industrial Comm'n, 225 Ill. 2d 159 (2007).
Specific conduct can demonstrate by inference the existence of an
agency relationship, despite contractual evidence that the parties
intended an independent contractor relationship. Dahan v. UHS of
Bethesda, Inc., 295 Ill. App. 3d 770 (1998).
In Roberson, the supreme court emphasized that the label given
by the parties in a written agreement will not be dispositive of
the employment status. Although a carrier agreement is a factor to
consider, it does not, as a matter of law, determine an
14
individual's agency status. Roberson, 225 Ill. 2d at 183; see also
Earley v. Industrial Comm'n, 197 Ill. App. 3d 309 (1990). The
trier of fact must also look to the facts of the case to define the
relationship between CHR and the drivers transporting the loads.
See Petrovich, 188 Ill. 2d at 46. Here, the carrier agreement
provided that the relationship of the carrier to CHR was "solely
that of an independent contract" and that the carrier employed the
drivers. However, there are substantial facts that indicate the
existence of an agency relationship.
In determining whether a person is an agent or an independent
contractor, the court's cardinal consideration is the right to
control the manner of work performance, regardless of whether that
right was actually exercised. Commerce Bank v. Youth Services of
Mid-Illinois, Inc., 333 Ill. App. 3d 150 (2002). Another
significant factor is the nature of work performed in relation to
the general business of the employer. Ware v. Industrial Comm’n,
318 Ill. App. 3d 1117 (2000). Other factors to consider are: (1)
the right to discharge; (2) the method of payment; (3) the
provision of necessary tools, materials, and equipment; (4) whether
taxes are deducted from the payment; and (5) the level of skill
required. Commerce Bank, 333 Ill. App. 3d at 153; Ware, 318 Ill.
App. 3d at 1122. No single factor is determinative, and the
15
significance of each may change depending on the work involved.
Roberson, 225 Ill. 2d at 175.
Applying these factors to this case, we find that the jury’s
decision was not against the manifest weight of the evidence.
First, CHR controlled the manner of Henry’s work performance.
Henry testified that she contacted Pleasants at CHR and asked for
a load. CHR required her to have a refrigerated trailer of a
specified length. Henry accepted a load of potatoes that CHR had
purchased in Idaho for delivery to its warehouse in Bolingbrook.
The LCS dictated special instructions concerning the load. Henry
did not see a copy of the LCS for the load of potatoes; however,
she testified that she was familiar with the LCS requirements based
on previous deliveries she had made for CHR. The special
instructions required her to pick up the load at a specified time,
make daily check calls, and stay in constant communication with
Pleasants and other CHR dispatchers. Henry was instructed to
notify CHR if she had an accident. She was also required to
continuously measure the temperature of the load during her trip.
If the load did not register a certain temperature, the LCS
required her to call CHR immediately.
CHR enforced its special instructions with a system of fines.
Pleasants testified that the fines were imposed as incentives to
16
drivers to get the load delivered on time. Yet, federal
regulations mandated that Henry drive 10 hours each day. Henry
testified that the schedule imposed by CHR dictated her method of
delivery and created pressure on her as a driver to get to her
destination. Henry stated that if she followed federal
regulations, she would be late delivering her load to the
Bolingbrook warehouse; Pleasants agreed with that assessment.
These extensive requirements, coupled with Henry's fine-based
compliance, directed Henry's conduct during the entire
transportation process and support the finding that CHR had the
right to control the manner in which Henry performed her job. See
Ware, 318 Ill. App. 3d at 1123 (control demonstrated by showing
detailed regulations and proving driver was personally responsible
for their observance).
Another factor of "great significance" is the nature of the
work performed in relation to the general business of the
defendant. Ware, 318 Ill. App. 3d at 1122. Here, Henry's services
are closely aligned with CHR's business. CHR is in the business of
transportation logistics, handling the means and methods of hauling
freight for its customers. CHR’s business necessarily requires the
service of semi-tractor drivers. The nature of Henry’s work is
hauling freight for customers from one location to another. The
17
work Henry performs is not unique; it is directly related to, if
not the same as, the general transportation business conducted by
CHR. In this case, the second factor weighs in favor of an agency
relationship.
Other factors also support the jury's verdict. First, CHR
controlled the method of payment. Henry called Pleasants and
requested a load. Dragonfly was not involved in the negotiations,
and once Henry accepted the load, she was dispatched by CHR, not
Dragonfly. If Henry successfully completed a delivery, CHR paid
her directly by depositing the negotiated fee into her bank
account. Second, the evidence indicates that CHR provided the
materials for delivery. Although Henry owned her tractor and
leased the trailer from Dragonfly, CHR purchased the potatoes and
requested delivery to its Bolingbrook facility.
Thus, several of the factors, including the two most pivotal
ones, indicate that Henry was acting as CHR’s agent at the time the
accident occurred. Thus, we cannot say that the jury’s decision
was unreasonable, arbitrary or contrary to the evidence.
Accordingly, the trial court properly denied CHR's motion for
judgment n.o.v. or for a new trial.
Nevertheless, CHR asks us to disregard the jury's verdict and
follow two federal district cases in which CHR was the defendant,
18
Jones v. C.H. Robinson Worldwide, Inc., 558 F. Supp. 2d 630 (W.D.
Va. 2008), and Schramm v. Foster, 341 F. Supp. 2d 536 (D. Md.
2004). In those cases, CHR moved for summary judgment on the issue
of liability. Both district courts granted the motion, finding
that the carrier driver was an independent contractor and that, as
a result, CHR was not liable for the driver's negligence. In
Jones, CHR arranged the pick up date and time, communicated
information from the shipper regarding the loading and unloading of
the cargo and required the driver to make daily calls regarding the
status of the shipment. Jones, 558 F. Supp. 2d at 639. In
Schramm, CHR directly dispatched the driver, instructed him to pick
up and deliver the load at a certain time, gave him directions to
the delivery destination and required the driver to call CHR during
the trip. Schramm, 341 F. Supp. 2d at 544-45.
We find those cases distinguishable. Critical facts that are
present in our case were not present in either Jones or Schramm.
Here, CHR owned the product being transported and the load was
being delivered to a CHR warehouse. Moreover, CHR imposed fines on
Henry to ensure she maintained CHR’s schedule during the trip.
CHR’s special instructions included the potential for multiple
fines and forced Henry to violate federal regulations in order to
avoid them. These facts support the inference that CHR controlled
19
the details of Henry’s operations, schedule and compensation.
The jury heard the testimony, considered the evidence and
concluded that CHR had an agency relationship with Henry. That
finding was not unreasonable or arbitrary. Considering the
evidence in a light most favorable to plaintiffs, we cannot say it
overwhelmingly favors CHR. Thus, the trial court properly
permitted the jury to decide the case and interpret the inferences
to be drawn based on the evidence.
II. Allocation of Fault
CHR also claims that Henry and Dragonfly should have been
included on the jury's verdict form for purposes of allocating
fault under section 2--1117 of the Code of Civil Procedure (Code)
(735 ILCS 5/2--1117 (West 2008)).
In cases of negligence, section 2--1117 allows a jury to
allocate the total fault attributable to the plaintiff among two or
more tortfeasors if their fault is greater than 25%. 735 ILCS 5/2-
-1117 (West 2008). Section 2--1117 also requires that the
tortfeasors’ liability be capable of being legally apportioned.
735 ILCS 5/2--1117 (West 2008). If liability among the tortfeasors
cannot be apportioned, section 2--1117 does not apply. Woods, 181
Ill. 2d at 520.
"When an action is brought against a master based on
20
allegedly negligent acts of the servant and no independent wrong is
charged on behalf of the master, liability is entirely derivative,
being founded upon the doctrine of respondeat superior." Moy v.
County of Cook, 159 Ill. 2d 519, 524 (1994). A principal found to
be vicariously liable is not found to be at fault but, rather, only
liable by application of the doctrine of respondeat superior.
American National Bank & Trust Co. v. Columbus-Cuneo-Cabrini
Medical Center, 154 Ill. 2d 347 (1992). In such cases, there is
only a basis for indemnity, not for apportionment of damages
between the principal and the agent. Id. at 353.
In this case, the finding of an agency relationship between
CHR and Henry eliminates the possibility of comparing conduct for
purposes of apportioning liability. Henry admitted negligence, and
the jury found that she was acting as CHR's agent when the accident
occurred. CHR was only found liable by application of the doctrine
of respondeat superior. Since CHR's liability is exclusively
derivative, it is not entitled to an allocation or comparison of
fault under section 2--1117 of the Code.
CHR also argues that the trial court should have allowed an
apportionment instruction between CHR and Dragonfly because
Dragonfly had a contractual relationship with Henry. CHR claims
that Dragonfly is also legally responsible for Henry's negligence
21
based on its carrier lease with Henry. CHR’s argument, however,
ignores the jury’s finding of an agency between CHR and Henry.
Once that legal relationship was established, CHR became entirely
liable for Henry's negligent conduct, which was the proximate cause
of the accident. Dragonfly's relationship with Henry may allow CHR
to seek contribution from Dragonfly, but it does not reduce CHR's
liability for plaintiffs' damages. See Woods, 181 Ill. 2d at 519-
20. Thus, the trial court properly denied CHR’s verdict form
seeking to allocate fault between Henry, Dragonfly and CHR.
CONCLUSION
The judgment of the circuit court of Will County is affirmed.
Affirmed.
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