Hartings v. Xu , 2014 Ohio 1794 ( 2014 )

[Cite as Hartings v. Xu, 2014-Ohio-1794.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
MERCER COUNTY
HILLARY A. HARTINGS, ET AL.,
PLAINTIFFS-APPELLANTS,
v. CASE NO. 10-13-11
THE NATIONAL MUTUAL
INSURANCE COMPANY, DBA
CELINA INSURANCE GROUP, ET AL.,
DEFENDANTS-APPELLANTS,
-and- OPINION
JINGHAO XU, ET AL.,
DEFENDANTS-APPELLEES.
Appeal from Mercer County Common Pleas Court
Trial Court No. 12-CV-003
Judgment Affirmed in Part, Reversed in Part and Cause Remanded
Date of Decision: April 28, 2014
APPEARANCES:
Bradley A. Powell for Appellants Hartings
Robert B. Fitzgerald for Appellants, The National Mutual Ins. Co.
Krystle N. Marko for Appellee, Rite Rug, Co.
Lisa A. Hesse for Appellees, Asiana Floors, Inc., etc.
Case No. 10-13-11
ROGERS J.
{¶1} Plaintiffs-Appellants, Hillary Hartings; Rebecca Bruns, Administratrix
of the Estate of Aubrey Bruns; Rebecca and John Bruns, as parents and natural
guardians of Conner D. Bruns; Rebecca Bruns and John Bruns, as parents and
natural guardians of Keaton Bruns; Rebecca Bruns, individually; and John Bruns,
individually (collectively “Hartings”), and Defendants-Appellants, the National
Mutual Insurance Company d/b/a Celina Insurance Group and Ohio Mutual
Insurance Company (collectively “the Insurance Companies”), appeal the
judgment of the Court of Common Pleas of Mercer County, granting summary
judgment in favor of Defendants-Appellees, Jinghao Xu; Asiana Floors, Jung Ho1
Bae, and Kim Bae2 (collectively “the Baes”); and Rite Rug Company (“Rite
Rug”). On appeal, Hartings and the Insurance Companies argue that the trial court
committed the following errors: (1) granting summary judgment in favor of Rite
Rug and the Baes by finding that Xu was an independent contractor; (2) granting
summary judgment as the decision was based upon a mistake of law; and (3)
granting summary judgment in favor of Rite Rug and the Baes on the issue of
negligent hiring and retention of Xu. For the reasons that follow, we reverse in
part and affirm in part the trial court’s judgment.
1
We note Jung Ho Bae’s name has also been spelled Jung Hoe Bae in the record.
2
Kim Bae is also known as Hyo Min Kam and is married to Jung Ho Bae.
-2-
Case No. 10-13-11
{¶2} On October 15, 2011, Hillary was driving her vehicle northbound on
US Route 127 in Mercer County, Ohio. Hillary’s three young cousins, Keaton,
Connor, and Aubrey Bruns, were also in her vehicle. Xu was driving his vehicle
westbound on State Route 119, approaching the intersection with US Route 127,
when he failed to stop at a stop sign and crashed into Hillary’s vehicle. It is
undisputed that Xu’s failure to either stop or yield to Hillary’s vehicle constituted
negligence and was the cause of the accident.3 As a result of Xu’s negligence,
Hillary, Keaton, and Connor sustained serious injuries, while Aubrey, who was
only three years old, was killed.
{¶3} Detective Megan Baker, from the Mercer County Sheriff’s Office, was
assigned to investigate this accident. In a sworn affidavit, she stated that she was
unable to speak with Xu at the accident scene because he could not read or speak
English. She took Xu’s Illinois driver’s license and ran it through central dispatch.
The driver’s license was not valid at the time of the accident. (Docket No. 133, p.
1). Detective Baker stated that she contacted the Illinois Department of Motor
Vehicles and confirmed that Xu’s driver’s license had been cancelled on July 10,
2009. (Id. at p. 2). Detective Baker also obtained a copy of Xu’s driving record
which revealed the following convictions: (1) on November 6, 2007, Xu was
convicted of an assured clear distance violation; (2) on December 13, 2007, Xu
3
According to the record, Xu was convicted of aggravated vehicular manslaughter and subsequently
deported to China.
-3-
Case No. 10-13-11
was convicted of a one way traffic violation; and (3) on February 1, 2008, Xu was
convicted of failure to control. (Id.).
{¶4} On January 6, 2012, Hartings filed a complaint against Xu, the
Insurance Companies, Jane/John Doe, and XYZ Corp. Hartings’ complaint
asserted nine claims: (1) personal injuries for Hillary Hartings; (2) personal
injuries and wrongful death for Aubrey Bruns; (3) personal injuries for Connor
Bruns; (4) personal injuries for Keaton Bruns; (5) medical expense and parental
consortium for Rebecca and John Bruns; (6) declaratory judgment and
underinsured claims against National Mutual Insurance Company; (7) declaratory
judgment and underinsured claims for Celina Insurance Group; (8) vicarious
liability for John and Jane Doe/XYZ Corp; and (9) negligent hiring and negligent
supervision for John and Jane Doe/XYZ Corp.
{¶5} On March 5, 2012, the Insurance Companies filed their answers.
Hartings’ complaint was amended on July 5, 2012, to add Rite Rug Co., Asiana
Floors, Inc., Jung Ho Bae, Ok Yeun Kinsley, and Hyo Min Kam as Defendants.
Rite Rug filed its answer to the amended complaint on July 19, 2012. Rite Rug
also filed a cross-claim against the Baes on July 23, 2012. On April 3, 2012, the
Baes filed their answer to the amended complaint, and on August 6, 2012, they
filed their answer to Rite Rug’s cross-claim. On August 8, 2012, the Insurance
-4-
Case No. 10-13-11
Companies filed its answers to the amended complaint. On December 14, 2012,
Hartings voluntarily dismissed the complaint against Ok Yeun Kinsley.4
{¶6} On January 30, 2013, Rite Rug filed a motion for summary judgment.
The Baes also filed a motion for summary judgment on February 1, 2013. On
February 21, 2013, Hartings filed memorandums in opposition to the motions for
summary judgment filed by Rite Rug and the Baes. On February 21, 2013, the
Insurance Companies also filed memorandums in opposition to Rite Rug’s and the
Baes’ motions for summary judgment.
{¶7} Throughout these pre-trial proceedings, numerous depositions were
taken. The following relevant evidence was adduced from these depositions.
The Baes
{¶8} Kim came to the United States from South Korea in 1997. She
currently has her green card and can read and speak English. In 2002, Kim began
to help Jung Ho Bae5 install flooring. Kim subsequently married Bae in 2003. At
that time, Bae was working for Rite Rug. Kim installed flooring for four months
and then began assisting with paperwork and other office related tasks.
{¶9} Bae created a flooring business that has gone through several different
name changes. In 2006, his business was called Jay Floorings. The business
4
Ok Yeun Kinsley is Kim Bae’s mother.
5
Since Jung Ho Bae created a business that he named after himself, from now on we will refer to Jung Ho
Bae, the individual, as “Bae” and his business as “Jung Ho Bae” in an attempt to avoid confusion among
our readers.
-5-
Case No. 10-13-11
name changed to Asiana Flooring Incorporated in 2007. Kim testified that they
only used the name “Asiana Flooring Inc.” for two years.6 Finally, in 2009, the
business name changed to Jung Ho Bae. Jung Ho Bae operates as a sole
proprietorship.
{¶10} Kim testified that the purpose of Jung Ho Bae was to deliver and
install Rite Rug flooring for Rite Rug. Jung Ho Bae has been working exclusively
for Rite Rug since 2002. Kim Bae Dep., p. 34-35. Kim also stated that Jung Ho
Bae does not have an office address, but instead has space inside the Rite Rug
warehouse in West Chester, Ohio.
{¶11} Kim testified that it was Jung Ho Bae’s responsibility to find
competent drivers and installers for Rite Rug. Kim also testified:
Q: Whose decision – whose ultimate decision was it to select or
hire individuals to deliver and install [for] RiteRug7?
A: Jung Ho Bae.
Q: Okay. RiteRug didn’t place any restrictions on who you could
hire?
A: No.
Q: Did RiteRug require Jung Ho Bae to make certain that whoever
was delivering or installing their product [have] a valid driver’s
license?
6
However, several checks, which were dated July 1, 15, and 22 of 2011, were issued by Asiana Flooring
Inc. to Xu. Kim Bae Dep., p. 166-167; Kim Bae Dep., Exhibit 4, p. 1-3.
7
We note that in some of the depositions, Rite Rug is incorrectly spelled as one word.
-6-
Case No. 10-13-11
A: Yes.
Q: Did they require that anybody who was delivering or installing
their product [have] a particular type of driving record –
A: No.
Q: -- meaning – okay. Did RiteRug require Jung Ho Bae to make
certain that whoever you selected or hired to deliver or install their
product was able to communicate in English?
A: No.
Q: Did RiteRug ever, and I mean from the time this agreement was
signed in 2002 to the present, did RiteRug ever get involved with the
process of selecting who was to perform the delivery and installation
of the product?
A: No.
Id. at p. 43-45.
{¶12} Although Kim testified Rite Rug was never involved in the hiring of
the installers, Kim stated that Rite Rug would sometimes tell her not to send an
installer to a specific job site and Kim would follow those instructions. Id. at p.
46.
{¶13} Kim works closely with the office manager of Rite Rug. Every day,
the office manager will give Kim work orders, and then Kim will assign the
different work orders to the Jung Ho Bae installers. After the work orders are
completed, Kim returns a list of completed jobs to the office manager and gets
paid. Kim elaborated on her relationship with Rite Rug:
-7-
Case No. 10-13-11
A: In the morning they give me the schedule.
Q: All right. So, there was no phone call to you. It was something
left on your desk?
A: Yeah. They leave it on the desk, schedule and work order.
Q: What’s the difference between a schedule and a work order?
A: Scheduling is just – they just type it in the computer, you know,
job name and, you know, how much amount of the work under next
to it, so we can just write it down, who’s doing what job, just record
of it.
Q: And those documents would be placed on your desk before you
arrived in the morning?
A: Yes.
Q: What time did you normally arrive in the morning?
A: Six o’clock.
***
Q: Okay. What do you do next? After you receive the schedule,
the work order, review the schedule and work order to make certain
all of the documents are in place, what’s the next thing you do?
A: Put a name on the schedule and installer’s name on the work
orders. I pick up the job for work orders, and I figure it out, who’s
going to do which job, and I put their name on the work order and
also put the name on their schedule, my schedule, too, so I know
who did which job, which guy did which job.
Id. at p. 52-53, 55-56.
-8-
Case No. 10-13-11
{¶14} Jung Ho Bae has fifteen installers who are all Chinese or Korean.
The installers come to Jung Ho Bae’s office space in the Rite Rug warehouse to
find out their job assignments every morning. Ted Han is an installer for Jung Ho
Bae and also helps Kim with paperwork. Every morning, the different installers
will talk to Han, who is in charge of distributing the job assignments. Once the
installers receive their assignments, they pick up the flooring material at a
different area in that same Rite Rug warehouse.
{¶15} Kim testified that Rite Rug, not Jung Ho Bae, inspects the installers’
work. She also explained that if an installer is new, someone from Jung Ho Bae
will walk the job site with the new installer, but stated that Jung Ho Bae does not
train any of its installers. Kim also stated that she has an ongoing relationship
with all her installers. She also testified that the installers are not allowed to pick
up the Rite Rug materials and install the flooring whenever they like. Instead,
there are certain hours when they must pick up the Rite Rug materials and the
installers must install the flooring on the date listed on the work order.
{¶16} Kim also testified that, to her knowledge, the installers do not work
for anyone else. The installers get paid on a weekly basis and get paid depending
on how many jobs they complete. When asked if Jung Ho Bae can fire the
installers it retains, Kim stated:
Q: Can you fire them?
-9-
Case No. 10-13-11
A: Yeah. If I don’t like them, we can let them go, but, you know –
but we never done that.
Q: You haven’t done that, but you have the right to fire somebody
that you don’t feel is doing a good job?
A: Yeah. If he keeps, you know, messing up the job or not
showing up, then you know, I use somebody else, because they’re
just subcontractor.
Q: Has any of these deliverers or installers quit?
A: Yes.
Q: There is nothing in any employment agreement or any written
agreement between Jung Ho Bae and the installers that prevent them
from quitting. Correct? They can quit if they don’t want to keep
working for you?
A: They can quit, yeah.
Id. at p. 119-120.
{¶17} Kim admitted that Jung Ho Bae does not conduct criminal
background checks before they hire installers or check an applicant’s driving
history. Kim stated she checks to make sure that each installer has a valid driver’s
license by “[l]ooking at their ID.” Id. at p. 123. She also stated that she does not
require the installers to speak or communicate in English. While Kim requires that
the installers have insurance coverage, she does not ask for proof of insurance or
verify that the installers actually obtain the insurance. Id. at p. 125.
-10-
Case No. 10-13-11
{¶18} Kim also explained how she met Xu. According to Kim, she first
met Xu in February or March 2011. Xu was introduced to her by another Rite
Rug installer, Mr. Choi. Kim stated that when she met Xu, he had stated that he
recently came to Cincinnati and moved from either Indiana or the Cleveland area.
Kim also testified that Xu had signed a subcontractor agreement form before he
started working for Jung Ho Bae. The subcontractor form was written in both
Korean and English. It stated, in relevant part:
Tools and/or supplies and vehicle are to be furnished by the installer.
Once installer leaves warehouse, he/she assumes all responsibility of
material being short and/or lost.
Any poor working condition must be reported immediately.
Otherwise installer assumes responsibility of damaged and/or poorly
installed materials.
Installer assumes all responsibility for job, once it is handed to them.
Amy [sic] failure to complete job, either due to accident of [sic]
illness, must be reported immediately.
Installer must maintain a clean, safe working environment at all
times while on job site. Any fines due to a failure to comply is [sic]
the installers [sic] responsibility.
Installer must have cell phone or way to communicate.
Installer must have a valid driver’s license and car insurance at all
times.
Installer must be bonded and certified. Any bodily injuries, either to
others and/or themselves, including personal property and/or
-11-
Case No. 10-13-11
property at jobsite is the responsibility of the installers while
traveling to jobsite, on jobsite and/or travelling from jobsite.
(Emphasis sic.) Kim Bae Dep., Exhibit 3, p. 1.
{¶19} Kim looked at the expiration date8 of Xu’s driver’s license. She was
unaware that he had an invalid license from the State of Illinois. She did not ask
Xu about prior car accidents or if he had any previous moving violations. Kim has
never driven with Xu. Kim also had the following discussion concerning whether
Xu could read street signs.
Q: How do you know that – he doesn’t communicate in English.
How do you know that he can safely operate this vehicle to get to the
job site? How do you know that?
A: He – I ask him, “do you know how to read the map?” He say,
“Yes.”
Q: Well, he can read the map, but he can’t read the road signs.
Correct?
A: Well, let me explain.
Q: If you know.
A: Yeah. Let me explain.
Q: Go ahead.
A: If the road name is like Smith Road, he’ll look at the Smith
Road, and he look for the Smith Road. And then, you know, it will
say “right on” with the picture, you know, on the Map Quest. So,
he just look at that, and, you know – I told him – and, you know,
8
It is undisputed that Xu’s license, although cancelled, was not expired at the time of the accident.
-12-
Case No. 10-13-11
when he start to working, we gave him Map Quest, just what
company attached. He never had problems. But, you know, I never
speak any English with him. So, I don’t know how much English he
have, either, you know, but he just told me he doesn’t speak any
English.
Kim Bae Dep., p. 162-163.
{¶20} Kim also recalled Xu coming to the warehouse on October 14, 2011.
She assigned Xu to install flooring for TK Kunkler at 406 Lowry Road, Fort
Recovery, Ohio (“the Kunkler job”). She testified that a map was attached to the
Kunkler job work order. After she assigned Xu the Kunkler job, Kim assumed
that Xu went to pick up the flooring material at a different part of the warehouse
and then he left to complete the job. Kim stated that Xu was supposed to do the
Kunkler job on Friday.
Q: So, he was supposed to deliver and install the material at the
Kunkler address in Fort Recovery, Ohio on October 14th, 2011, on a
Friday?
A: Yes.
Q: And that’s because that’s Jung Ho Bae’s policy and procedure
with respect to how the work and when the work is to be performed?
A: Yes.
Q: And he was to complete the job that day, because it was a vinyl
job that should only last one day?
A: Yes. And it was a small job, too.
Id. at 180-181.
-13-
Case No. 10-13-11
{¶21} Kim testified that she learned Xu was in a car accident on Saturday
after Han called her and informed her about the accident. She further stated that it
was not until that following Monday when she discovered that Xu was on his way
to complete the Kunkler job when he got into the car accident. Jung Ho Bae had
also scheduled Xu a repair job on Saturday, October 15, 2011, in Beavercreek,
Ohio (“Beavercreek repair job”). Xu completed the Beavercreek repair job before
he got in the car accident.
Rite Rug
{¶22} Rite Rug is a flooring distributor who sells and installs flooring. Rite
Rug’s headquarters are in Columbus, Ohio but they do business all throughout
Ohio and in Indiana, Illinois, North Carolina, South Carolina, Tennessee,
Kentucky, Pennsylvania, and Georgia. Rite Rug sells all sorts of flooring products
such as carpet, tile, hardwood, vinyl, and laminate. Rite Rug’s customers mostly
consist of new home builders. Once a future homeowner selects the material he or
she wants installed, the builder will notify Rite Rug of the type and amount of
material that is needed for that specific house. The price for the material is
negotiated and then a date for installation of the material is scheduled. All of the
flooring material is stored in the Rite Rug warehouse. The material is owned by
Rite Rug until it is installed in the home.
-14-
Case No. 10-13-11
{¶23} Vince Moyer, Rite Rug’s builder operations manager, was deposed
in this matter. It is Moyer’s responsibility to make sure the home builders are
satisfied with the installation of Rite Rug’s flooring materials. Moyer was able to
explain Rite Rug’s relationship with Jung Ho Bae:
A: Rite Rug – builders call in their jobs they have for tomorrow, a
week from now. It’s put on a schedule. The jobs are then all given
to Kim Bae. She then dispatches it to other subcontractors that go
out and do the work.
Q: And where does Kim get the list of jobs from? Does she get
them from, for example, you, or does she get them from home
office, or where does she get them from?
A: The Cincinnati office scheduling box.
Moyer Dep., p. 13-14.
{¶24} Moyer was also able to explain the hiring process for installers.
Moyer stated:
A: We would get a packet from our corporate office that has
subcontractor information that you have to fill out from – and I don’t
know all of the packages, but I know there’s, like, W-2 forms,
subcontractor agreement, and forms like that –
Q: Okay.
A: -- a big packet that we have to give to every installer that wants
to become a subcontractor for Rite Rug, background check.
***
Q: * * * Does it include, for example, do I need insurance?
-15-
Case No. 10-13-11
A: You need insurance.
Q: Okay. Is that automobile insurance and general liability
insurance?
A: Yes.
Q: Okay. You said there’s a background check?
A: Yes.
Q: Is that a criminal background check?
A: Not sure.
Q: Okay. What about driving record?
A: I know they make a copy of their driver’s license and send it in,
but what our corporate office does with it, I couldn’t tell you.
Id. at p. 20-22.
{¶25} Once the application is completed, Moyer will send it into the
corporate office and get a response whether the applicant can work as a
subcontractor for Rite Rug. Moyer does not verify any of the information in the
application packets because that is the corporate office’s responsibility.
{¶26} While Rite Rug supplies installers with materials for installation, it
does not provide tools or cars to installers. Moyer stated that all the new home
builders have an understanding that the installation is done by subcontractors.
Moyer also stated:
-16-
Case No. 10-13-11
Q: Sure. [The builders] rely upon you, Rite Rug, to make the
selection of who installs the material that they’ve ordered from Rite
Rug. Correct?
A: Correct.
Q: You sell yourself as being able to provide that service.
Correct?
A: Yes and no. We don’t sell ourselves to provide it, because we
don’t install it. We hire subcontractors to do it, and they know that.
Id. at 109.
{¶27} When asked whether Rite Rug has the ability to ban installers from
certain job sites, Moyer had the following exchange:
Q: Have you, in your years of working with Kim, ever told her to
not use a particular individual crew member or any crew?
A: I’m sure I have. I mean, I’m sure there’s been builders that
have said, “We don’t want Mr.” – I’m going to say Thomas, or, you
know, but –
Q: Sure.
A: “We don’t want Mr. Thomas back on this job site.” So, that
would be myself or Aaron or someone to call Kim and say, “hey, Joe
from Ryan Homes does not want Mr. Thomas back on the job site.”
Q: And you have the right to do that, don’t you, Rite Rug?
A: Try not to say –
Q: Rite Rug has the right to say this person isn’t wanted on the job
site. Correct?
A: If our customer tells us that, yes, absolutely.
-17-
Case No. 10-13-11
Id. at p. 125.
{¶28} Moyer also stated that he is unaware whether the installers work for
any other companies, but knew that in the past, some installers advertised their
services for other companies.
{¶29} Aaron Bayer, the production manager for Rite Rug, was also deposed
and testified as to Rite Rug’s policies and procedures. He stated that it is Rite
Rug’s policy for the installers to come to the warehouse to “pick up, inspect the
material, load the material[,] and then deliver [it].” Bayer Dep., p. 37. Bayer also
testified that it is Jung Ho Bae’s responsibility, not Rite Rug’s, to assign the
installers to the different job sites. He stated that Jung Ho Bae was already
working for Rite Rug in 2007 when he started working for Rite Rug. Bayer
admitted that he personally does nothing to ensure that the installers are competent
to drive. He stated he is unaware if Rite Rug does anything to verify the installers
are competent drivers. Bayer also explained that Rite Rug provides all the
installers with maps and directions to each job site “[t]o make sure they know how
to get there.” Id. at p. 43.
{¶30} When asked how Rite Rug obtains installers, Bayer testified:
Q: Okay. All right. Well, let’s go on to the installation phase.
Who installs RiteRug’s product?
A: Installers.
-18-
Case No. 10-13-11
Q: Where does RiteRug obtain installers?
A: We don’t have any installers.
Q: How do you know that?
A: We hire Kim, Asiana Floors or Jung Ho Bae to install our
floors, and however she handles that is up to her, as long as the jobs
get done.
Id. at p. 45-46.
{¶31} Bayer explained that part of his job is to inspect the work that is done
by the installers. Bayer also stated:
Q: Does RiteRug provide training to these installers?
A: No.
Q: How do you know that?
A: It would be up to me or Vince [Moyer] to set up some type of
training.
Q: You expect and require that the installers, that they’ve been
trained on how to install RiteRug’s product?
A: Yes.
Q: And they need to know how to install product according to the
trade, the industry and the manufacturer’s specifications. Correct?
A: Correct.
Id. at p. 48. Bayer stated that Rite Rug usually does not need to provide
instruction or guidance to the installer on particular jobs, but “[o]ccasionally it
-19-
Case No. 10-13-11
does.” Id. a p. 52. Bayer testified that there have been times when he has
instructed Kim not to send back the original installer on a job when the installer
has made a significant mistake.
{¶32} Bayer agreed that “the delivery and the installation is an integral part
of the RiteRug business of selling flooring[.]” Id. at p. 58-59. Bayer also stated
that Jung Ho Bae is the exclusive installer for the builder division of the non-
carpet materials. Bayer also admitted that Rite Rug advertises itself as a “seller
and installer of floor materials.” Id. at p. 143. He elaborated:
Q: Okay. So, when you’re working with these builders or the
homeowners in the retail arena, you don’t say, ‘Hey, we’ll sell you
the materials and then we’re going to hire somebody else to install
them,’ do you?
A: No, we do not, as far as I know.
Q: It comes as a package. RiteRug is selling this and installing it
for you. Right?
A: As far as I know, yes.
Id. at p. 143-144.
{¶33} Bayer testified that Jung Ho Bae installers are not allowed in the
warehouse when the warehouse is closed. He also testified that Jung Ho Bae has
had a space in the warehouse since he started working for Rite Rug. When asked
if he was aware that Jung Ho Bae used installers who were not legal residents of
the United States, Bayer replied, “I don’t know.” Id. at p. 101.
-20-
Case No. 10-13-11
{¶34} Erin Appleman is the advertising director for Rite Rug and is
“[r]esponsible for media buys, marketing materials, and communication to the
public in the form of advertising.” Appleman Dep., p. 8. Appleman was able to
talk about Rite Rug’s website, specifically, their installation FAQ section. She
stated:
Q: You used phrases [on Rite Rug’s website] such as Rite Rug’s
installers, our installers, we. Do you agree that the intention of –
your intention was to notify the reviewing public or the viewing
public of the website that it was Rite Rug’s people that were going to
install the Rite Rug product?
A: No.
Q: What was your intention?
A: That Rite Rug installs the products that they sell.
***
Q: Okay. Why didn’t you say subcontractors in the website?
A: No reason. I mean, we didn’t.
Id. at p. 41.
On Rite Rug’s installation section of their website it states:
Once you purchase your Rite Rug carpet, hardwood, laminate, tile or
vinyl flooring at any of our locations, we’ll set up installation
immediately.
And even though our team of professional installers reports to us,
they work for you, ensuring your satisfaction at every turn. They’re
quick, polite, tidy and experienced. Why we’d even say you can
-21-
Case No. 10-13-11
expect the professional installation and customer service you get
from Rite Rug to be “seamless.”
Appleman’s Dep., Exhibit A, p. 3.
{¶35} The website also has a section about installation warranties.
Appleman did not know why Rite Rug would give a warranty on an installation
performed by subcontractors. Appleman testified that none of her superiors have
ever told her to change the wording in the installation section of Rite Rug’s
website.
{¶36} Michael Nelson, Rite Rug’s corporate warehouse manager, was also
deposed. He testified that although Rite Rug does not give formal evaluations of
its installers, Rite Rug does train its installers.
Q: * * * How did you make certain that Rite Rug’s installers were
meeting the industry standards?
A: Through meetings, through training.
Q: With the installers?
A: Yes. Sir.
Q: Do you recall, you know, any of those particular
circumstances? Were these like a field day or operations day at Rite
Rug where people who were doing installation would have to do
come up for training, or would they be one-on-one type training with
installers?
A: Both.
Nelson Dep., p. 47.
-22-
Case No. 10-13-11
{¶37} Nelson also testified that Rite Rug does not do anything to verify its
installers are competent to deliver its materials.
Q: * * * What did Rite Rug do to make certain that the person who
was delivering Rite Rug’s product to the job site was competent to
deliver that material, to drive that vehicle containing Rite Rug’s
product from the warehouse to the job site?
A: Nothing that I’m aware of.
Q: Now I want to break that down just to make sure we cover
everything. Did Rite Rug make certain that the individual who was
driving, delivering the material, had a valid driver’s license?
A: No, sir.
Q: Did they make certain that that driver or deliverer had car
insurance?
A: No, sir.
Q: Did they do anything to make certain that person who was
delivering the product could communicate in English?
A: No, sir.
Id. at p. 56-57.
{¶38} Nelson also testified that installers get paid on a regular basis and the
amount of their pay check is based on how many jobs that installer completed in a
pay period. However, if, after Rite Rug’s inspection, it finds that the job was
completed incorrectly, it will back-charge the installer for that job and he will not
get reimbursed until the job is done correctly.
-23-
Case No. 10-13-11
{¶39} Nelson also testified that he knows that Rite Rug’s carpet installers
are employees, however, he was unaware if the installers of hard surface flooring
are Rite Rug employees. Id. at 424. Nelson also stated that he has precluded an
installer from working for Rite Rug. Nelson stated that “there were decisions
made that this particular installer was – was not of the quality we wanted, so we
were no longer going to use their services.” Id. at p. 44-45. This happened on
more than one occasion.
Xu
{¶40} Xu testified at his deposition9 that he does not know Jung Ho Bae or
Kim Bae. He stated he knew Han, but never went to a warehouse near Cincinnati.
When presented with the subcontractor agreement he signed for Jung Ho Bae, Xu
adamantly denied that he had signed the agreement or had even seen it before. He
also stated that no one has ever explained the terms of the contract to him.
{¶41} Xu explained that every work site he has worked on had a supervisor.
If he needed to ask the supervisor a question, he would call Han, and Han would
translate for him. He purchased all tools needed to install floors and also bought
the van he drove. He also explained that he does not need any instructions or
directions on how to install flooring because “all information was contained in the
work order[.]” Id. at p. 177.
9
Since Xu does not speak English, a translator was present during his deposition and translated for Xu.
-24-
Case No. 10-13-11
{¶42} Xu thought that at the time of his car accident he had a valid driver’s
license. He also testified:
Q: Were you able to understand, based on the map, where the job
site was?
A: Yes, I can.
Xu Dep., p. 138. Xu also admitted that at the time of the accident he was on his
way to a job site.
{¶43} Xu also stated:
Q: Okay. If he didn’t want to do a job, could he turn it down?
A: Of course. Yeah, for example, if on the same day maybe the
first one call and the second one call right away, I have to refuse.
Q: Because he couldn’t be in two places at the same time?
A: No.
Q: Okay. But whether or not he declines a job is up to him,
correct?
A: Yes, I decide myself.
Id. at p. 141-142.
{¶44} Xu could correctly identify what a stop sign looks like. Also he
stated he has a GPS device in his car. Xu also stated that he looked up directions
on his computer at home to figure out how to get to the job site on October 15,
2011. He memorized the route and drew himself a “simple map.” Id. at p. 144.
-25-
Case No. 10-13-11
According to Xu, Mr. Choi met Xu at his house and gave him materials for the
Kunkler job. He also denied doing a repair job in Beavercreek, Ohio the morning
of October 15, 2011.
{¶45} Xu testified that it was his belief that he had a valid driver’s license
on October 15, 2011. He further stated:
Q: So it’s your testimony that you did not know that the state of
Illinois cancelled your license on July 20th, 2009; is that correct, July
10th, 2009?
A: I have no way to know because there was no notice, no mailing,
no message. And when I bought my car nobody tell me anything
about my driver’s license being a problem. I have no way to know.
Q: Where were you living in Chicago?
A: A friend’s place.
Q: Where was your friend’s place?
A: No, no idea.
Q: Do you remember the address you gave the Department of
Motor Vehicles in Illinois as to where you lived?
A: Don’t remember.
Q: Do you remember giving them the address of a furniture store
in Illinois as your home address?
A: I have no idea.
Q: You don’t remember that, is that what you are telling me? You
don’t remember giving the Illinois Bureau of Motor Vehicles the
address of a furniture store as your home address?
-26-
Case No. 10-13-11
A: No idea.
Id. at p. 188-189.
{¶46} On May 8, 2013, the trial court granted summary judgment in favor
of the Baes and Rite Rug.
{¶47} Hartings and the Insurance Companies filed this timely appeal,
presenting the following assignments of error for our review.
The Insurance Companies’ Assignment of Error No. I
THE TRIAL COURT ERRED IN SUSTAINING
DEFENDANTS/APPELLEES [SIC] MOTION[S] FOR
SUMMARY JUDGMENT WHEN GENUINE ISSUES OF
MATERIAL FACT EXISTED[.]
The Insurance Companies’ Assignment of Error No. II
THE TRIAL COURT ERRED IN SUSTAINING
DEFENDANTS/APPELLEES [SIC] MOTIONS FOR
SUMMARY JUDGMENT AS THE DECISION WAS BASED
UPON A MISTAKE OF LAW[.]
Hartings’ Assignment of Error No. I
THE TRIAL COURT ERRED BY GRANTING SUMMARY
JUDGMENT IN FAVOR OF THE DEFENDANTS-
APPELLEES, RITE RUG CO. AND/OR THE BAES BY
RULING, AS A MATTER OF LAW, THAT XU WAS AN
INDEPENDENT CONTRACTOR OF RITE RUG CO.
AND/OR THE BAES.
Hartings’ Assignment of Error No. II
-27-
Case No. 10-13-11
THE TRIAL COURT ERRED BY GRANTING SUMMARY
JUDGMENT IN FAVOR OF THE DEFENDANTS-
APPELLEES, RITE RUG CO. AND THE BAES ON THE
ISSUE OF THE NEGLIGENT HIRING AND RETENTION OF
XU.
{¶48} Due to the nature of the assignments of error, we elect to address
them out of order and address the Insurance Companies’ and Hartings’ first
assignments of error together.
Insurance Companies’ Assignment of Error No. II
{¶49} In its second assignment of error, the Insurance Companies contend
that the trial court erred in applying the standard set out in Bostic v. Connor, 37
Ohio St.3d 144 (1988), since Bostic has been superseded in statute after the
enactment of R.C. 4123.01(A)(1)(c). We disagree.
{¶50} The Insurance Companies argue that the trial court erred by not using
the proper test for determining whether Xu was an employee or an independent
contractor. They contend that the common law test set out in Bostic was
superseded in statute after the enactment of R.C. 4123.01(A)(1)(c). However, it is
Rite Rug’s and the Baes’ contention that even if Bostic was superseded by R.C.
4123.01(A)(1)(c), since the present case does not deal with workers’
compensation, R.C. 4123.01(A)(1)(c) is irrelevant. We find that the legislature
only intended to redefine employees as it relates to construction contracts in
workers’ compensation cases when it enacted R.C. 4123.01(A)(1)(c).
-28-
Case No. 10-13-11
{¶51} R.C. 4123.01(A)(1)(c) states, in relevant part:
As used in this chapter:
(A)(1) “Employee” means:
***
(c) Every person who performs labor or provides services pursuant
to a construction contract, as defined in section 4123.79 of the
Revised Code, if at least ten of the follow criteria apply:
(i) The person is required to comply with instructions from the
other contracting party regarding the manner or method of
performing services;
(ii) The person is required by the other contracting party to have
particular training;
(iii) The person’s services are integrated into the regular
functioning of the other contracting party;
(iv) The person is required to perform the work personally;
(v) The person is hired, supervised, or paid by the other
contracting party;
(vi) A continuing relationship exists between the person and the
other contracting party that contemplates continuing or recurring
work even if the work is not full time;
(vii) The person’s hours of work are established by the other
contracting party;
(viii) The person is required to devote full time to the business of
the other contracting party;
(ix) The person is required to perform the work on the premises of
the other contracting party;
(x) The person is required to follow the order of work set by the
other contracting party;
(xi) The person is required to make oral or written reports of
progress to the other contracting party;
(xii) The person is paid for services on a regular basis such as
hourly, weekly, or monthly;
(xiii) The person’s expenses are paid for by the other contracting
party;
(xiv) The person’s tools and materials are furnished by the other
contracting party;
-29-
Case No. 10-13-11
(xv) The person is provided with the facilities used to perform
services;
(xvi) The person does not realize a profit or suffer a loss as a result
of the services provided;
(xvii) The person is not performing services for a number of
employers at the same time;
(xviii) The person does not make the same services available to the
general public;
(xix) The other contracting party has a right to discharge the
person;
(xx) The person has the right to end the relationship with the other
contracting party without incurring liability pursuant to an
employment contract or agreement.
(Emphasis added.) Thus, the definition of employee contained in R.C.
4123.01(A)(1)(c) is limited to claims filed under Chapter 4123. It is undisputed
that this case does not involve a claim for workers’ compensation, thus, R.C.
4123.01(A)(1)(c) is inapplicable.
{¶52} To support their position, the Insurance Companies argue that
Slauter v. Klink, 2d Dist. Montgomery No. 18150, 2000 WL 1162041 (Aug. 18,
2000), stands for the proposition that the legislature intended to redefine employee
and substitute the statutory test contained in R.C. 4123.01 for the common law
standard for any case that deals with construction contracts. We do not interpret
the Second District’s opinion so broadly. In Slauter, the appellant was allegedly
injured by a truck driven by the appellee. Id. at *1. At the time, the appellant and
appellee worked for the same company. Id. The appellant received workers’
compensation benefits for his injuries, but filed suit against the appellee claiming
-30-
Case No. 10-13-11
that she had negligently operated the truck. Id. The appellee successfully
asserted that she was immune from tort actions by co-workers under R.C.
4123.741. Id. The trial court used the statutory test found in R.C.
4123.01(A)(1)(c) to determine whether the appellee was an employee. Id.
However, the appellant argued that the trial court should have used the common
law standard. Id.
{¶53} The court in Slauter found that R.C. 4123.01(A)(1)(c), “appears to be
an attempt to codify the various factual matters courts have considered when
deciding if an employee relationship, including the employer’s ‘right to control,’
exists.” Id. at *4. The court also looked to Sub. H. Bill No. 245 for guidance and
noted that the “legislature’s intent in amending 4123.01 was to redefine
‘employee’ for purposes of the Workers’ Compensation Law.” (Emphasis added.)
Id. Lastly, in Slauter, the court had to determine whether the appellee was an
employee in order to see whether the immunity provision of R.C. 4123.741
applied. Since the appellee invoked a defense that was found within the workers’
compensation chapter, it was appropriate for the court to use the test found in R.C.
4123.01(A)(1)(c) to determine whether she was an employee.
{¶54} Other courts have similarly agreed that the statutory test found in
R.C. 4123.01(A)(1)(c) only applies to workers’ compensation cases. See Grange
Mut. Cas. Co. v. Laughlin, 5th Dist. Licking No. 12-CA-0089, 2013-Ohio-4447;
-31-
Case No. 10-13-11
Snyder v. Stevens, 4th Dist. Scioto No. 12CA3465, 2012-Ohio-4120. In Laughlin,
the court held that since “R.C. Chapter 4123 sets forth Ohio’s statutory scheme for
workers’ compensation[,] * * * R.C. 4123.01 defines an ‘employee’ for purposes
of workers’ compensation.” 2013-Ohio-4447, ¶ 21. Further, in Snyder, the court
held that because the appellant did not “bring a claim under R.C. 4123 and [did]
not cite any case law incorporating this standard into a common law negligence
claim” the statutory standard was inapplicable. 2012-Ohio-4120, ¶ 27.
{¶55} While the Insurance Companies are correct in noting that Bostic
involved a workers’ compensation claims, it is apparent that courts have adopted
the common law standard set out in Bostic to apply to all sorts of matters that do
not implicate workers’ compensation claims. For example, the Ohio Supreme
Court has recently used the standard set out in Bostic to determine whether Virtual
Learning Academy instructors were independent contractors or teachers entitled to
compensation from the State Teachers Retirement Board. State ex rel. Nese v.
State Teachers Retirement Bd. Of Ohio, 136 Ohio St.3d 103, 2012-Ohio-1777, ¶ 2.
This court has also used the test set out in Bostic to determine whether a physician
was an employee or independent contractor for gender discrimination purposes.
Bower v. Henry Cty. Hosp., 3d Dist. Seneca No. 13-12-46, 2013-Ohio-2844, ¶ 28.
-32-
Case No. 10-13-11
{¶56} Therefore, because Hartings did not bring a claim under R.C. 4123,
we find that the statutory test found in R.C. 4123.01(A)(1)(c) is not applicable to
this matter.
{¶57} Accordingly, we overrule the Insurance Companies’ second
assignment of error.
The Insurance Companies’ & Hartings’
Assignments of Error No. I
{¶58} In their first assignments of error, the Insurance Companies and
Hartings argue that the trial court erred in granting summary judgment in favor of
the Baes and Rite Rug because there were genuine issues of material fact as to
whether Xu was an employee of the Baes and of Rite Rug. We agree.
Standard of Review
{¶59} An appellate court reviews a summary judgment order de novo.
Hillyer v. State Farm Mut. Auto. Ins. Co., 131 Ohio App.3d 172, 175 (8th
Dist.1999). Accordingly, a reviewing court will not reverse an otherwise correct
judgment merely because the lower court utilized different or erroneous reasons as
the basis for its determination. Diamond Wine & Spirits, Inc. v. Dayton
Heidelberg Distrib. Co., 148 Ohio App.3d 596, 2002-Ohio-3932, ¶ 25 (3d Dist.),
citing State ex rel. Cassels v. Dayton City School Dist. Bd. of Edn., 69 Ohio St.3d
217, 222 (1994). Summary judgment is appropriate when, looking at the evidence
-33-
Case No. 10-13-11
as a whole: (1) there is no genuine issue as to any material fact, and (2) the moving
party is entitled to judgment as a matter of law. Civ.R. 56(C). In conducting this
analysis the court must determine “that reasonable minds can come to but one
conclusion and that conclusion is adverse to the party against whom the motion for
summary judgment is made, [the nonmoving] party being entitled to have the
evidence or stipulation construed most strongly in the [nonmoving] party’s favor.”
Id. If any doubts exist, the issue must be resolved in favor of the nonmoving
party. Murphy v. Reynoldsburg, 65 Ohio St.3d 356, 358-59 (1992).
{¶60} The party moving for summary judgment has the initial burden of
producing some evidence which demonstrates the lack of a genuine issue of
material fact. Dresher v. Burt, 75 Ohio St.3d 280, 292 (1996). In doing so, the
moving party is not required to produce any affirmative evidence, but must
identify those portions of the record which affirmatively support his argument. Id.
at 292. The nonmoving party must then rebut with specific facts showing the
existence of a genuine triable issue; an adverse party may not rest on the mere
allegations or denials of the party's pleadings. Id.; Civ.R. 56(E).
Employee v. Independent Contractor
{¶61} Generally, while an employer is vicariously liable for the negligent
acts of its employees committed within the scope of employment under the
doctrine of respondeat superior, an employer of an independent contractor is not
-34-
Case No. 10-13-11
liable for the negligent acts of the independent contractor.10 Pusey v. Bator, 94
Ohio St.3d 275, 278 (2002); Clark v. Southview Hosp. & Family Health Ctr., 68
Ohio St.3d 435, 438 (1994).
{¶62} To determine whether a party is an employee or an independent
contractor, we must resolve the central question of “who had the right to control
the manner or means of doing the work[?]” Bostic, 37 Ohio St.3d at paragraph
one of the syllabus. This inquiry is fact-intensive and requires the consideration of
a number of factors, none of which are dispositive by themselves. Id. at 146.
Factors to be considered include “who controls the details and quality of the work;
who controls the hours worked; who selects the materials, tools and personnel
used; who selects the routes traveled; the length of employment; the type of
business; the method of payment; and any pertinent agreements or contracts.” Id.
{¶63} Usually, when the evidence is not in dispute or facts are admitted, the
question of whether a person is an employee or independent contractor is a matter
of law to be decided by the court. Id.; Schickling v. Post Publishing Co., 115 Ohio
St. 589 (1927). However, when the worker offers some evidence that he was an
10
Ohio recognizes three exceptions to this rule. Sullivan v. Oregon Ford, Inc., 552 F.Supp.2d 681, 685
(N.D.Ohio 2008). First, an employer may be liable for injuries that are a result of the employer’s failure to
“exercise reasonable care in the selection of a competent and careful independent contractor.” Albain v.
Flower Hosp., 50 Ohio St.3d 251, 257-258 (1990) overruled on other grounds in Clark v. Southview Hosp.
& Family Health Ctr., 68 Ohio St.3d 435 (1994). Second, an employer may be liable if the independent
contractor is performing a non-delegable duty imposed by statute, contract, common law, or arising from
inherently dangerous work. Id. Third, an employer may be liable for the negligence of an independent
contractor under the doctrine of agency by estoppel. Id. at 262-263.
-35-
Case No. 10-13-11
employee rather than an independent contractor, the issue becomes a question for
the trier of fact to decide. Bostic at 146-147; see also O’Day v. Webb, 29 Ohio
St.2d 215, paragraph four of the syllabus (1972) (“It is the duty of a trial court to
submit an essential issue to the jury when there is sufficient evidence relating to
that issue to permit reasonable minds to reach different conclusions on that issue *
* *.”).
{¶64} Since Hartings and the Insurance Companies have presented
sufficient evidence to allow reasonable minds to differ on the issue of whether Xu
was an employee to the Baes and/or Rite Rug, we find that the trial court erred in
granting the Baes’ and Rite Rug’s motions for summary judgment. Our review of
the record reveals that there was evidence from which a jury could reasonably
infer that Xu was either an employee or an independent contractor.
{¶65} On one hand, evidence was presented which tends to prove that Xu
was an independent contractor. It is undisputed that the installers had to provide
their own tools and vehicles. While it appears that Rite Rug attached a map to
work orders, there was no testimony presented that the installers were instructed
they had to follow these routes to the job sites. Lastly, the method of payment is
also suggestive of an independent contractor since Xu was paid per job, and not at
an hourly rate. While the presence of subcontractor agreements also points toward
-36-
Case No. 10-13-11
an independent contractor relationship, Xu adamantly denied signing a
subcontractor agreement, making this a disputed fact.
{¶66} On the other hand, evidence was presented which tends to indicate
that the Baes and Rite Rug had the right to control the manner or means by which
Xu performed his work. The mere fact that a contracting party reserves the right
to approve the work of the worker does not necessarily establish an employer-
employee relationship. Perron v. Hood Industries, Inc., 6th Dist. Lucas No. L-06-
1396, 2007-Ohio-4478, ¶ 31. Only when “the control of the work reserved in the
employer which effects a master-servant relationships is control of the means and
manner of performance of the work, as well as of the result; an independent
contractor relationship exists * * *.” Id.{¶67} While it was undisputed that Rite Rug had supervisors at the job sites
and inspected the work of the installers, the Insurance Companies and Hartings
also presented some evidence that Rite Rug controlled the means and manner of
performance of its installers. Although there was testimony that Rite Rug does not
train its installers, this was contradicted by Nelson’s testimony that Rite Rug does,
in fact, train its installers, both in group meetings and in one-on-one sessions.
Kim Bae also stated that sometimes the Baes will “walk the job site” with new
installers in order to teach them how to properly install floors.
-37-
Case No. 10-13-11
{¶68} Further, all the flooring materials that the installers use are provided
by Rite Rug. After receiving a work order, the installers are directed to pick up
Rite Rug flooring materials in the Rite Rug warehouse before they drive to the job
sites. Testimony was elicited from both Rite Rug employees and the Baes that
they retained the right to terminate installers if they did not produce satisfactory
work. The fact that none of the installers were discharged is irrelevant, as long as
the Baes and Rite Rug maintained the right to discharge an installer if necessary.
The ongoing nature of the Baes’ and Rite Rug’s relationship also points to an
employer-employee relationship. See Harmon v. Schnurmacher, 84 Ohio App.3d,
207, 213 (11th Dist.1992). (“[A]n independent contractor is generally hired to
complete a single job only and does not have a continuing, full-time relationships
with a single client.”). Rite Rug has employed the Baes to provide them with
installers for over 10 years and has even provided them with office space in its
warehouse to conduct business. Rite Rug exclusively uses the Baes to install their
flooring. Similarly, the Baes only work for Rite Rug. Thus, there is some
evidence of an ongoing relationship with the installers, the Baes, and Rite Rug.
{¶69} Construing the evidence most strongly in Hartings’ favor, we find
that the trial court erred in granting the Baes’ and Rite Rug’s motions for summary
judgment.
-38-
Case No. 10-13-11
{¶70} Accordingly, we sustain Hartings’ and the Insurance Companies’
first assignments of error.
Hartings’ Assignment of Error No. II
{¶71} In her second assignment of error, Hartings contends that the trial
court erred by granting summary judgment in favor of the Appellees on the issue
of negligent hiring and retention. We agree.
{¶72} In order for a plaintiff to prove negligent hiring or retention, he or
she must show:
(1) [T]he existence of an employment relationship; (2) the
employee’s incompetence; (3) the employer’s actual or constructive
knowledge of such incompetence; (4) the employee’s act or
omission causing the plaintiff’s injuries; and (5) the employer’s
negligence in hiring or retaining the employee as the proximate
cause of plaintiff’s injuries.
Evans v. Ohio State Univ., 112 Ohio App.3d 724, 739 (10th Dist.1996), quoting
Ruta v. Breckenridge-Remy Co., 6th Dist. Erie No. E-80-039, 1980 WL 351648(Dec. 12, 1980). These elements are related to the basic elements of negligence:
duty, breach, proximate cause, and damages.
{¶73} Regardless of whether Xu is found to be an independent contractor or
-39-
Case No. 10-13-11
an employee of Rite Rug and/or the Baes, some sort of employment relationship11
existed between them. Further, it is undisputed that Xu was incompetent to drive
and deliver Rite Rug materials, since he did not have a valid driver’s license. It is
also undisputed that Xu’s negligence caused the Hartings’ injuries. However, the
parties do dispute whether the Baes and Rite Rug had constructive knowledge of
Xu’s incompetence. Thus, whether the Baes and Rite Rug owed a duty to the
Hartings turns on whether a reasonably prudent person, with the Baes and Rite
Rug’s knowledge, would have anticipated that Xu would cause a car accident.
{¶74} It is clear from the record that the Baes and Rite Rug had no actual
knowledge of Xu’s incompetence. The more important question is whether the
Baes and Rite Rug had constructive knowledge.12 Constructive knowledge is
defined as “[k]nowledge that one using reasonable care or diligence should have,
and therefore that is attributed by law to a given person * * *.” Black’s Law
Dictionary 404 (9th Ed.2009). The Baes and Rite Rug argue that Xu’s
11
For purposes of a negligent hiring or retention claim, it is irrelevant whether the worker is an employee
or an independent contractor. Albain, 50 Ohio St.3d at 257 (“It is well-established that an employer must
exercise reasonable care in the selection of a competent and careful independent contractor.”); Rodic v.
Koba, 8th Dist. Cuyahoga No. 77599, 2000 WL 1807042, fn. 2 (“[A]ppellee’s assertion that an independent
contractor relationship is not a sufficient basis for a negligent hiring claim is without merit.”); Best v.
Energized Substation Serv., Inc., 88 Ohio App.3d 109, 115 (9th Dist.1993) (“[Restatement of the Law 2d,
Torts (1965) 376, Section 411] recognizes liability to ‘third persons’ for negligent selection of an
independent contractor.”).
12
Rite Rug claims in its brief, that it had “no involvement in hiring installers * * *. As such, Rite Rug
would have no involvement in verifying whether an installer possessed a valid driver’s license * * *.” Rite
Rug Br., p. 16. However, this is contradicted by the testimony of its own employee, Moyer, who testified
that every installer must fill out an application packet. Moyer Dep., p. 20. As part of this application
packet, the applicant must make a copy of their driver’s license. Id. at p. 22. Once the application is
complete, Moyer sends it into the corporate office and will receive a response as to whether the applicant
can work for Rite Rug.
-40-
Case No. 10-13-11
responsibility of transporting the flooring materials was incidental to his main task
of installing the flooring and that since driving a car was not part of his job
responsibilities, they had no duty to look into Xu’s driving history. The Baes and
Rite Rug point towards the subcontractor agreements they made all installers sign.
They argue that these agreements do not mention that delivering goods is part of
an installer’s job responsibilities.
{¶75} However, this is contradicted by almost every employee who was
deposed from Rite Rug. These employees testified that the transportation of the
flooring materials is a principal responsibility of an installer. Bayer explained that
all the installers are required to deliver the flooring materials to the job sites and
that both the delivery and the installation was an integral part of the Rite Rug
business. Bayer Dep., at p. 36-37, 58. Moyer testified that Rite Rug relies upon
the installers to the deliver the materials to their job sites. Moyer Dep., p. 173.
Benjamin Adams also testified that it is the installer’s responsibility to pick up the
flooring materials from the warehouse and deliver it to the job site. Adams Dep.,
p. 28-29.
{¶76} Further, Kim Bae testified that delivering materials in Xu’s car was
in furtherance of Jung Ho Bae’s business. She also stated that the installers
deliver Rite Rug’s product and install it on behalf of Jung Ho Bae.
-41-
Case No. 10-13-11
{¶77} Therefore, there is some dispute as to whether delivery was an
integral part of Xu’s job responsibilities. There is also the fact that Xu presented
an Illinois driver’s license to the Baes and Rite Rug despite not residing in Illinois
for a significant period of time. Based on the unique circumstances of this case,
the matter should be submitted to a trier of fact to determine whether delivery was
an integral part of Xu’s job responsibilities and whether the Baes and Rite Rug
exercised reasonable care in selecting Xu to deliver their goods by simply looking
at his driver’s license.
{¶78} The Baes use Mut. Ins. Co. of Eagle Tp. v. Hunt, 3d Dist. Hancock
No. 5-2000-07, 2000 WL 1273607 (Sept. 7, 2000), to support their position.
However, Hunt is distinguishable from the present matter. In Hunt the appellants
hired an independent contractor who set fire to the appellee’s home. Id. at *1.
The trial court found that the fire was caused by improperly disposing of lighted
cigarettes. Id. This court found that even if the appellants were negligent in hiring
the worker, their negligence was not the proximate cause of the fire since such an
accident was “no more probable because the appellants had failed to inspect any of
Smith’s prior work, had failed to request references from him, or had failed to
conduct an extensive interview or background check.” Id. at *3.
{¶79} In this case, if the jury finds that the Baes and/or Rite Rug did not
make a reasonable inquiry into Xu’s driving history, the jury could also find that
-42-
Case No. 10-13-11
the Baes’ and Rite Rug’s negligence was the proximate cause of Hartings’
injuries. If the Baes and/or Rite Rug looked into Xu’s driving history, they would
have found that he did not have a valid driver’s license and would not have hired
him to deliver flooring materials. Had Xu not been driving Rite Rug materials to a
job site on October 15, 2011, he would not have gotten into a car accident with
Hartings and the Bruns and caused their injuries. Thus, we do not find the facts
of Hunt analogous to this case.
{¶80} We similarly find the Baes’ use of Pusey v. Bator, 94 Ohio St.3d 275(2002), unpersuasive. In Pusey, the Ohio Supreme Court was outlining the
general exceptions for when an employer may be responsible for the negligent acts
of an independent contractor. Id. at 279. Specifically, the Court was explaining
the inherently dangerous work exception which provides that “the employer hiring
the independent contractor has a duty to see that the work is done with reasonable
care and cannot, by hiring an independentcontractor [sic], insulate himself or
herself from liability for injuries resulting to others from the negligence of the
independent contractor * * *.” Id. at 279-280. However, the inherently dangerous
work exception does not apply when there is only a general anticipation that an
independent contractor may act negligent in some way and thereby cause harm to
a third party. Id. at 280. Since Hartings is not alleging that the Baes or Rite Rug
are vicariously liable for the acts of Xu because he was engaged in an inherently
-43-
Case No. 10-13-11
dangerous activity, we do not find Pusey to be instructive in this matter. Hartings
asserts that the Baes and Rite Rug were negligent in hiring Xu, not that they were
negligent in supervising Xu while he was engaged in a dangerous activity.
{¶81} Accordingly, we sustain Hartings’ second assignment of error.
{¶82} Having found error prejudicial to Hartings and the Insurance
Companies in their first assignment of error and in Hartings second assignment of
error, but having found no error prejudicial to the Insurance Companies in their
second assignment of error, we affirm in part and reverse in part the trial court’s
judgment and remand this matter for further proceedings consistent with this
opinion.
Judgment Affirmed in Part,
Reversed in Part, and
Cause Remanded
WILLAMOWSKI, P.J. and SHAW, J., concur.
/jlr
-44-