Schwinn v. Long & Foster Real Estate, Inc. ( 2010 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 08-1608
HORST SCHWINN, Guardian Ad Litem of Doerte Hesse,
Plaintiff - Appellant,
and
MARCUS HESSE, Guardian Ad Litem of Josef Hesse,
Plaintiff,
v.
LONG & FOSTER REAL ESTATE, INCORPORATED,
Defendant – Appellee,
and
CHARLES STEPHEN EBBETS,
Defendant.
No. 08-1663
MARCUS HESSE, Guardian Ad Litem of Josef Hesse,
Plaintiff - Appellant,
and
HORST SCHWINN, Guardian Ad Litem of Doerte Hesse,
Plaintiff,
v.
LONG & FOSTER REAL ESTATE, INCORPORATED,
Defendant – Appellee,
and
CHARLES STEPHEN EBBETS,
Defendant.
Appeals from the United States District Court for the Eastern
District of Virginia, at Alexandria. Leonie M. Brinkema,
District Judge. (1:07-cv-00603-LMB-TCB)
Argued: September 23, 2009 Decided: January 25, 2010
Before MOTZ, Circuit Judge, HAMILTON, Senior Circuit Judge, and
Irene M. KEELEY, United States District Judge for the Northern
District of West Virginia, sitting by designation.
Affirmed by unpublished per curiam opinion.
ARGUED: Steven M. Garver, GARVER LAW OFFICES, PC, Reston,
Virginia, for Appellants. Danielle D. Giroux, HARMAN, CLAYTOR,
CORRIGAN & WELLMAN, Richmond, Virginia, for Appellee. ON BRIEF:
Douglas K. Landau, ABRAMS LANDAU LTD, Herndon, Virginia; Roger
T. Creager, THE CREAGER LAW FIRM, PLLC, Richmond, Virginia, for
Appellant Horst Schwinn, Guardian Ad Litem of Doerte Hesse.
Stanley P. Wellman, HARMAN, CLAYTOR, CORRIGAN & WELLMAN,
Richmond, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
The dispute before us grows out of a tragic accident. At
approximately 10:30 A.M. on July 23, 2005, while riding their
motorcycle in Fauquier County, Virginia, Josef Hesse and his
wife, Doerte (“the Hesses”), were struck by a Cadillac Deville
sedan driven by a realtor named Charles Stephen Ebbets
(“Ebbets”). The Hesses received catastrophic brain injuries as a
result of the accident and are incapacitated. Their guardians ad
litem sued Ebbets individually, and also sued Long & Foster Real
Estate, Inc. (“Long & Foster”) as Ebbets’s employer under a
theory of respondeat superior. The district court entered
judgment in favor of Long & Foster after concluding that Long &
Foster was not vicariously liable for the Hesses’ injuries
because Ebbets was not acting as its employee at the time of the
accident. Following this, the Hesses proceeded to trial against
Ebbets and obtained a verdict for $36 million in damages. They
now appeal to us, arguing that the district court erred when it
entered summary judgment in Long & Foster’s favor. We affirm.
I.
Sometime prior to 2005, Ebbets entered into a Broker-
Associate Independent Contractor Agreement (“Agreement”) with
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Long & Foster. 1 As part of this Agreement, the parties
contemplated that Long & Foster would provide Ebbets with access
to its facilities and listings, and also would assign him a
supervising broker as required under Virginia law. The parties
further agreed that, in exchange for these benefits, Ebbets, a
very successful realtor, would use his best efforts to sell or
lease real estate listed by Long & Foster. Throughout their
relationship, each party was entitled to receive a percentage of
any commissions received from real estate sales closed by
Ebbets.
II.
The question before us is whether, under Virginia law,
Ebbets, who was returning from a property inspection to
Long & Foster’s offices in Warrenton, Virginia when the accident
occurred, was an employee of Long & Foster or an independent
contractor. The Hesses contend that, to resolve this question,
we must consider the four factors of (1) selection and
engagement, (2) payment of compensation, (3) power of dismissal,
and (4) power to control the work of the individual articulated
in McDonald v. Hampton Training Sch. for Nurses, 486 S.E.2d 299,
1
The independent contractor agreement is not dated. In his
deposition, Ebbets stated that he believed he entered into the
agreement in 2000, but he was uncertain of this date.
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301 (Va. 1997). Of these, they assert the power to control is
determinative, and that the provisions of Virginia law requiring
brokers to supervise real estate salespersons impose a legal
duty on brokers to control the realtors they supervise. See Va.
Code Ann. § 54.1-2101 (2009); 18 Va. Admin. Code § 135-20-160(D)
(2009). They also argue that the limitations and requirements
imposed on Ebbets under the Agreement, and the circumstances of
his relationship with Long & Foster, could allow a jury
reasonably to infer that Long & Foster had the power to control
the means and methods of his sales efforts and performance as a
realtor.
Long & Foster disputes this, arguing that, both under
Virginia law and the terms of the Agreement, Ebbets was an
independent contractor. It contends the licensing regulations
of the Virginia Real Estate Board that require all realtors to
be supervised by a licensed real estate broker cannot create a
de facto master-servant relationship. 2 This is because § 54.1-
2101 defines “real estate salesperson” in part, as a person
“affiliated as an independent contractor with[] a real estate
broker . . . .” According to Long & Foster, to hold that
2
Virginia regulations require supervising brokers to
“exercise reasonable and adequate supervision of the provision
of real estate brokerage services by associate brokers and
salespersons assigned to the branch office.” 18 Va. Admin. Code
§ 135-20-160(D).
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Virginia’s Administrative Code imposes a duty on brokers to
control the realtors they supervise would eviscerate the
Virginia General Assembly’s statutory expectation that a broker
may supervise a realtor working as an independent contractor to
the broker. Finally, Long & Foster points to terms in the
Agreement that expressly forbade it from controlling the means
and manner of Ebbets’s work as a realtor, terms it honored
throughout its relationship with Ebbets.
After considering these arguments in the parties’ cross-
motions for summary judgment, the district court granted summary
judgment to Long & Foster. In a well-reasoned opinion that
thoroughly analyzed applicable Virginia law, as well as the
Agreement between Long & Foster and Ebbets, the district court
concluded that Ebbets was acting as an independent contractor at
the time of the accident. It therefore granted summary judgment
on the basis that Long & Foster neither controlled nor had the
power to control Ebbets’s work as a realtor. Hesse v.
Ebbets, 2007 WL 4562818 (E.D. Va. 2007).
III.
We review a district court’s entry of summary judgment de
novo, drawing all inferences in the light most favorable to the
non-moving party. Williams v. Griffin, 952 F.2d 820, 823 (4th
Cir. 1991). After careful consideration of the record, the
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briefs and oral arguments, and the record before us, we affirm
on the basis of the district court’s well-reasoned opinion.
AFFIRMED
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