McKenna v. Beesley

Filed 8/6/21
CERTIFIED FOR PUBLICATION
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
BLAKE MCKENNA, D077189
Plaintiff and Appellant,
v. (Super. Ct. No. 37-2018-
00009594-CU-PA-CTL)
LANCE BEESLEY et al.,
Defendants and Respondents.
APPEALS from judgments of the Superior Court of San Diego County,
Gregory W. Pollack, Judge. Judgments and orders reversed.
Ritter & Associates, Dwight F. Ritter, Karen L. Albence; Williams
Iagmin and Jon R. Williams for Plaintiff and Appellant.
Friedenthal, Heffernan & Brown and Jay D. Brown for Defendant and
Respondent Lance Beesley.
Gordon Rees Scully Mansukhani and Don Willenburg for Defendant
and Respondent Smoothreads, Inc.
I.
INTRODUCTION
The California Supreme Court has explained that the tort of negligent
entrustment of a motor vehicle and the tort of negligent hiring of a person to
drive a vehicle are both premised on the “[a]wareness [by the defendant],
constructive or actual, that a person is unfit or incompetent to drive.” (Diaz
v. Carcamo (2011) 51 Cal.4th 1148, 1157 (Diaz).) In this appeal, we consider
two issues related to the scope of the constructive knowledge element of these
torts.
First, we consider the effect of the Legislature’s enactment of Vehicle
Code section 14604, 1 on the common law tort of negligent entrustment of a
motor vehicle. Section 14604 requires an owner of a motor vehicle “to make a
reasonable effort or inquiry to determine whether [a] prospective driver
possesses a valid driver’s license before allowing him or her to operate the
owner’s vehicle.” We conclude that a jury may find that an owner who
breaches its section 14604 duty and permits an unlicensed driver to drive the
owner’s vehicle had constructive knowledge of the driver’s incompetence to
drive.
We also consider whether a person may be held liable for the common
law tort of negligent hiring when the person hires another and allows the
hiree to drive a vehicle under the hirer’s control without making a reasonable
effort or inquiry to determine whether the hiree has an appropriate driver’s
license, and the hiree in fact lacks such license. (See § 14606, subd. (a) [“A
person shall not . . . hire . . . any person to drive a motor vehicle owned by
1 Unless otherwise specified, all subsequent statutory references are to
the Vehicle Code.
2
him or her or under his or her control upon the highways unless that person
is licensed for the appropriate class of vehicle to be driven”].) Under these
circumstances, we conclude that a jury may find that the hirer had
constructive knowledge of the hiree’s incompetence to drive. 2
II.
FACTUAL AND PROCEDURAL BACKGROUND
A. The complaint
In February 2018, Blake McKenna filed a form complaint against
Lance Beesley and Smoothreads, Inc. (Smoothreads). 3 McKenna checked
boxes on the form complaint indicating that he was bringing causes of action
for “Motor Vehicle,” and “General Negligence.” McKenna also checked a box
indicating that he was bringing causes of action styled as “Negligence Per Se,
[and] Negligent Entrustment.”
In an attachment to the complaint, McKenna alleged that on August 4,
2017, he was a pedestrian lawfully crossing the street when he was struck by
a vehicle driven by Ann Rogers. McKenna alleged that Rogers’s vehicle
struck him due to the negligence of “Doe 1,” (i.e., Ronald Wells) 4 who had
2 We emphasize that we do not hold that an owner or hirer’s failure to
make a reasonable effort or inquiry into the driver’s or hiree’s licensure
status, in and of itself, establishes civil liability, or even actionable
negligence. Rather, we hold only that such evidence provides a sufficient
basis for a jury to find that the plaintiff has proven the constructive
knowledge element of these torts.
3 McKenna also sued Ann Rogers, another driver involved in the accident
that forms the basis for his action. Rogers is not a party to this appeal.
McKenna’s complaint also named several Doe defendants.
4 As we explain in parts II.B and II.C, post, it is undisputed that Beesley
hired Wells to perform work on Beesley’s home and permitted Wells to drive
the vehicle that was involved in the accident. We refer to “Doe 1” as Wells,
3
“negligently [run] a red light.” Specifically, McKenna alleged that Wells
negligently drove his vehicle through a red light, striking Rogers’s vehicle,
and that Rogers’s vehicle in turn struck McKenna. 5 McKenna alleged that
he suffered severe bodily injuries as a result of the accident.
McKenna also alleged that Wells was driving a vehicle owned by
Beesley and Smoothreads. 6 McKenna further alleged that Beesley and
Smoothreads knew or should have known that, due to Wells’s past driving
experience and/or lack of driving experience, Wells was a negligent driver
who created a risk of harm to persons and property and that Beesley and
Smoothreads nevertheless knowingly entrusted Wells with the use of the
vehicle involved in the accident. 7
because the parties assumed for purposes of the proceedings relevant to this
appeal, that Wells was the driver identified as “Doe 1” in McKenna’s
complaint.
5 McKenna’s complaint also alleged that Wells violated several Vehicle
Code provisions, including a provision pertaining to a driver’s responsibilities
after an accident. As Beesley summarizes in his brief, “[T]he driver of
[Smoothreads’s vehicle (assumed to be Wells for purposes of this appeal),]
exited the vehicle, surveyed the damage, and then fled on foot.”
6 In a separate attachment to the form complaint, McKenna checked
boxes indicating that: Wells was an operator of a motor vehicle; Beesley and
Smoothreads employed Wells; Beesley and Smoothreads owned the vehicle
and permitted it to be operated by Wells; Beesley and Smoothreads entrusted
the vehicle to Wells; and Wells was an agent of Beesley and Smoothreads. It
is undisputed that, in fact, Smoothreads, and not Beesley, owned the vehicle.
(See pt. II.B and C, post.)
7 Specifically, McKenna alleged, “[McKenna] is informed and believes
that [Beesley and Smoothreads] knowingly and/or negligently entrusted their
insured truck to [Wells] . . . an incompetent driver, whom they knew or
should have known was incompetent to drive and [Beesley and Smoothreads
4
B. Smoothreads’s motion for summary adjudication
Smoothreads filed a motion for summary adjudication in May 2019 in
which it sought a determination that McKenna could not prevail on a claim of
negligent entrustment against it, among other arguments. 8 In a supporting
brief, Smoothreads explained that, for purposes of its motion, it assumed that
Smoothreads, through Beesley, had granted Wells permission to drive the
vehicle that was involved in the accident. 9 However, Smoothreads contended
that it was entitled to summary adjudication of McKenna’s negligent
entrustment claim against it because there was no “evidence . . . to
demonstrate that Smoothreads . . . had any actual or constructive knowledge
that the vehicle operator was an incompetent, reckless or inexperienced
driver.”
Smoothreads argued in relevant part:
“The sole officer and shareholder of Smoothreads is . . .
Beesley. [Citation.] Beesley hired Wells to perform some
various home construction projects at the Beesley home.
[Citation.] Wells represented that he had an active
California contractor’s license and around 40 years of
experience in the industry. [Citation.] In fact, when Wells
arrived at the Beesley home, Wells was driving his own
vehicle. [Citation.] These undisputed facts demonstrate
that Smoothreads, by and through Beesley, had absolutely
no reason to suspect any level of driving incompetence or
unfitness on the part of Wells. Beesley understood that
Wells was an experienced contractor, with an active
contractor’s license, and Wells arrived driving his own
are] thus liable for the injuries that resulted to . . . McKenna from the
collision . . . .”
8 Smoothreads argued that its liability to McKenna, if any, should be
limited to $15,000 pursuant to section 17151. (See fn. 14, post.)
9 Smoothreads also acknowledged that it was “the owner of a vehicle
involved in the accident.”
5
vehicle. Nothing about that situation puts Smoothreads ‘on
notice’ of any incompetence or unfitness with respect to
Wells[’s] driving ability.
“Similarly, [McKenna] cannot show any actual knowledge
of unfitness. Wells never informed Beesley of any history
with bipolar disorder [citation], never informed him of any
history of alcohol problems [citation], never informed him of
any history of DUI arrests [citation], never informed him of
any arrests in his driving history [citation], and never
informed him that he did not have a driver’s license.[ 10]
[Citation.] Simply stated, Smoothreads, by and through
Beesley, lacked the required actual knowledge in order for
[McKenna] to prevail on a negligent entrustment theory.
Given this lack of knowledge, either actual or constructive,
about any level of unfitness or incompetence with respect to
Wells, Smoothreads, by and through Beesley, had
absolutely no ‘duty to inquire’ any further. Instead,
Smoothreads was ‘entitled to rely on [Wells] to discharge
[his] responsibilities with reasonable care.’ ” 11
C. Beesley’s motion for summary judgment
Beesley filed a motion for summary judgment in May 2019, presenting
an argument similar to Smoothreads’s argument in its motion for summary
adjudication. In a supporting brief, Beesley stated that he is the chief
executive officer of Smoothreads and acknowledged that Smoothreads was
10 In his opposition, McKenna presented evidence that, at the time of the
accident, Wells did not have a valid driver’s license or auto insurance. In
addition, McKenna presented evidence that Wells’s driving history included
three suspensions for three separate convictions of driving under the
influence. In addition, McKenna lodged excerpts of Wells’s deposition in
which Wells stated that he suffered from bipolar disorder and that he had
“trouble with alcohol.”
11 In the omitted citations, Smoothreads cited to facts contained in its
separate statement of undisputed material facts, filed concurrently with its
motion.
6
the owner of a vehicle involved in the accident. However, Beesley stated that
Wells was “never employed by [Smoothreads] and never performed work of
any kind for [Smoothreads].” Beesley did acknowledge that Beesley had
“used Mr. Wells for various . . . handyman jobs at his residence.”
Beesley maintained that he could not be liable for negligent
entrustment because, even assuming that Wells was the operator of the
Smoothreads vehicle involved in the accident and that Beesley gave Wells
permission to drive the vehicle, “Beesley had no knowledge that Mr. Wells
was incompetent [to] drive the subject vehicle.” Specifically, Beesley argued,
“At no time was [Beesley] aware that . . . Wells did not have a valid driver’s
license, or that he had a history of alcohol-related driving incidents.” Beesley
also stated, “Wells never told Mr. Beesley [t]hat he was in any way
incompetent to operate a vehicle.”
D. McKenna’s oppositions
In his oppositions to Beesley’s and Smoothreads’s motions, McKenna
argued that “Beesley, president [and chief executive officer] of Smoothreads,
negligently hired, supervised, or retained . . . Wells, and knew or should have
known that . . . Wells was incompetent or unfit to drive [Smoothreads’s
vehicle].” 12 (Boldface & underscore omitted.) McKenna argued in part:
“Beesley negligently hired, negligently supervised, and
negligently retained . . . Wells. [Citation.] . . . Wells did not
have a valid driver’s license, nor auto insurance coverage.
[Citation.] Also, Wells[’s] driving history included [three]
suspensions for [three] separate [driving under the
influence] criminal convictions. . . . Beesley, [president],
and [chief executive officer] of Smoothreads, did not ask
Wells, his employee, whether he had a valid driver’s
12 Although McKenna filed separate oppositions to the two motions, the
oppositions were identical in many respects, including the language quoted in
the text.
7
license. [Citation.] Beesley did not ask Wells, his
employee, before Wells drove, or after, whether he had auto
insurance coverage. [Citation.]
“Beesley did not ask Wells before he drove, or after, about
Wells[’s] driving history or verify Wells[’s] driving history
in the State of California which contained multiple
suspensions, including [three driving under the influence]
criminal convictions. [Citation.] Wells worked at Beesley’s
home throughout the months of June, July and August of
2017. [Citation.] Beesley had multiple opportunities while
working to ask Wells if he had a valid driver’s license and,
if not, any driving restrictions or suspensions. [Citation.]
As a matter of fact, the State of California would not license
Wells as a competent driver and suspended him from
driving on [three] occasions. The State of California knew
and treated Wells as an incompetent driver. Beesley knew
or should have known that Wells was being negligently
supervised, negligently retained, and incompetent to drive
[Smoothreads’s vehicle]. [Citation.]” 13
E. The trial court’s order granting Smoothreads’s motion for summary
adjudication and granting Beesley’s motion for summary judgment
After Smoothreads and Beesley filed replies to McKenna’s oppositions,
the trial court held a hearing on the motions. The court subsequently entered
an order on September 6, 2019 granting both Smoothreads’s motion for
summary adjudication and Beesley’s motion for summary judgment. The
trial court reasoned in part:
“Neither Beesley nor Smoothreads had any actual
knowledge of any facts that would have placed either on
notice of Wells’[s] lack of licensure or otherwise unfitness to
13 In the omitted citations, McKenna also cited to facts contained in his
separate statements of undisputed material facts, filed concurrently with his
oppositions. In particular, as noted in footnote 10, ante, McKenna presented
evidence of Wells’s incompetency to drive a motor vehicle, including Wells’s
lack of a valid driver’s license.
8
operate a motor vehicle. See Richards v. Stanley (1954)
43 Cal.2d 60, 63 [(Richards)] (‘[l]t has generally been held
that the owner of an automobile is under no duty to persons
who may be injured by its use to keep it out of the hands of
a third person in the absence of facts putting the owner on
notice that the third person is incompetent to handle it.’).
Accordingly, neither Beesley nor Smoothreads had a legal
duty to conduct any investigation or make any inquiry
regarding Wells’[s] fitness to operate a motor vehicle.
“The question whether a legal duty exists is to be resolved
by the court, not a jury. [Citation.] ‘Duty, being a question
of law, is particularly amenable to resolution by summary
judgment.’ [Citation.]
“McKenna cites no persuasive legal authority to the effect
that an owner entrusting his vehicle to a third party faces
liability for negligent entrustment when, not knowing any
facts to put him on notice of the third party’s unfitness,
simply fails to conduct an investigation to determine
fitness. This would create a new legal duty in California,
and this court is not inclined to make new law. . . .
“Finally, McKenna’s reliance upon [section] 14606 is
misplaced. In Dodge Center v. Superior Court (1988)
199 Cal.App.3d 332, 338 [(Dodge Center)], the court stated:
“ [‘]Section 14606, like the common law cause of action for
entrustment, requires a showing of knowledge of the
incapacitating condition which under the statute is lack of a
license. In the absence of such knowledge there is no
duty to inquire. [Emphasis added.][’] ”
F. The trial court’s judgments
The trial court entered a judgment in favor of Beesley on the basis of its
summary judgment order on October 30, 2019. On February 28, 2020, the
trial court entered a judgment in favor of Smoothreads. The trial court’s
February 28 judgment states in relevant part:
9
“On or about September 6, 2019, the Court granted
[Smoothreads’s] Motion for Summary Adjudication, ruling
that Smoothreads’[s] liability, if any, to [McKenna] for his
causes of action of General Negligence and Motor Vehicle
Negligence was limited to $15,000 pursuant to the
permissive use statute ([§] 17151). [McKenna] has since
waived his right to collect under a permissive use claim.” 14
G. The appeals
In December 2019, McKenna timely filed an appeal from the October
30, 2019 judgment in favor of Beesley, and in March 2020, McKenna timely
filed an appeal from the February 28, 2020 judgment in favor of
Smoothreads.
III.
DISCUSSION
The trial court erred in granting Smoothreads’s motion for summary
adjudication and Beesley’s motion for summary judgment
McKenna contends that the trial court erred in granting Smoothreads’s
motion for summary adjudication and Beesley’s motion for summary
judgment. Specifically, McKenna claims that a reasonable jury could find
14 Section 17150 provides, “Every owner of a motor vehicle is liable and
responsible for death or injury to person or property resulting from a
negligent or wrongful act or omission in the operation of the motor vehicle, in
the business of the owner or otherwise, by any person using or operating the
same with the permission, express or implied, of the owner.” However, an
owner’s liability under section 17150 is limited to $15,000 per person in any
one accident. (See § 17151). A common law cause of action for “negligent
entrustment is an independent tort” that may be brought separately from a
section 17150 cause of action. (Bayer-Bel v. Litovsky (2008) 159 Cal.App.4th
396, 400.)
Smoothreads states in its brief, “As the parties have stipulated,
[McKenna] is entitled to $15,000 pursuant to . . . section 17151, and
Smoothreads has already paid this amount. [McKenna] can only be entitled
to more if he has a valid claim for negligent entrustment.”
10
Smoothreads liable for negligent entrustment and Beesley liable for negligent
hiring.
We first provide an overview of the relevant legal principles, before
addressing in detail McKenna’s claims as to each defendant.
A. The law governing summary adjudication and summary judgment
“ ‘Summary judgment and summary adjudication provide courts with a
mechanism to cut through the parties’ pleadings in order to determine
whether, despite their allegations, trial is in fact necessary to resolve their
dispute. [Citations.] A defendant moving for summary judgment or
summary adjudication may demonstrate that the plaintiff’s cause of action
has no merit by showing that (1) one or more elements of the cause of action
cannot be established, or (2) there is a complete defense to that cause of
action.’ ” (Camacho v. Target Corp. (2018) 24 Cal.App.5th 291, 296
(Camacho).)
A party is entitled to summary adjudication of a cause of action if there
is no triable issue of material fact and the party is entitled to judgment as a
matter of law on that cause of action. (Code Civ. Proc., § 437c, subd. (f)(1),
(2).) A trial court shall grant summary judgment if “all the papers submitted
show that there is no triable issue as to any material fact and that the
moving party is entitled to a judgment as a matter of law,” (id., subd. (c)),
with respect to the entire “action.” (Id., subd. (a).)
“ ‘On appeal, the reviewing court makes “ ‘an independent assessment
of the correctness of the trial court’s ruling [regarding summary adjudication
or summary judgment], applying the same legal standard as the trial court in
determining whether there are any genuine issues of material fact or
whether the moving party is entitled to judgment as a matter of law.’ ” ’
11
[Citation.] Our task is to determine whether a triable issue of material fact
exists.” (Camacho, supra, 24 Cal.App.5th at p. 297.)
B. Substantive law
1. The torts of negligent entrustment and negligent hiring
a. Negligent entrustment
“California is one of several states [that] recognizes the liability of an
automobile owner who has entrusted a car to an incompetent, reckless, or
inexperienced driver” (italics omitted) through the tort of negligent
entrustment. (Allen v. Toledo (1980) 109 Cal.App.3d 415, 420.)
In Ghezavat v. Harris (2019) 40 Cal.App.5th 555, 559, the court
outlined the tort of negligent entrustment, where the object entrusted is a
motor vehicle:
“Negligent entrustment is a common law liability doctrine,
which arises in numerous factual contexts. [Citation.] In
cases involving negligent entrustment of a vehicle, liability
‘ “is imposed on [a] vehicle owner or permitter because of
his own independent negligence and not the negligence of
the driver.” ’ [Citations.] ‘ “Liability for the negligence of
the incompetent driver to whom an automobile is entrusted
does not arise out of the relationship of the parties, but
from the act of entrustment of the motor vehicle, with
permission to operate the same, to one whose
incompetency, inexperience, or recklessness is known or
should have been known by the owner.” ’ [Citation.];
accord, Rest.2nd Torts, § 308 [‘It is negligence to permit a
third person to use a thing or to engage in an activity which
is under the control of the actor, if the actor knows or
should know that such person intends or is likely to use the
thing or to conduct himself in the activity in such a manner
as to create an unreasonable risk of harm to others’].)”
CACI No. 724 outlines the elements of the tort of negligent
entrustment of a motor vehicle:
12
“1. That [name of driver] was negligent in operating the
vehicle;
“2. That [name of defendant] [owned the vehicle operated
by [name of driver]/had possession of the vehicle operated
by [name of driver] with the owner’s permission];
“3. That [name of defendant] knew, or should have known,
that [name of driver] was incompetent or unfit to drive the
vehicle;
“4. That [name of defendant] permitted [name of driver] to
drive the vehicle; and
“5. That [name of driver]’s incompetence or unfitness to
drive was a substantial factor in causing harm to [name of
plaintiff].” 15
b. Negligent hiring
“California case law recognizes the theory that an employer can be
liable to a third person for negligently hiring, supervising, or retaining an
unfit employee.[ 16] [Citation.] Liability is based upon the facts that the
15 (See Jeld-Wen, Inc. v. Superior Court (2005) 131 Cal.App.4th 853, 864
[noting that CACI No. 724 outlines elements of negligent entrustment of
motor vehicle claim].)
16 California law also provides that a person “who negligently fails to
employ a competent and careful contractor may be liable for injuries caused
by the contractor’s failure to exercise due care.” (Chevron U.S.A., Inc. v.
Superior Court (1992) 4 Cal.App.4th 544, 549, disapproved on other grounds
by Camargo v. Tjaarda Dairy (2001) 25 Cal.4th 1235, italics added.) In
Camargo, the Supreme Court concluded that “an employee of an independent
contractor [is barred] from bringing a negligent hiring action against the
hirer of the contractor.” (Camargo, supra, at p. 1238, italics added [noting
that section 411 of the Restatement Second of Torts provides that “[a]n
employer is subject to liability for physical harm to third persons caused by
his failure to exercise reasonable care to employ a competent and careful
13
employer knew or should have known that hiring the employee created a
particular risk or hazard and that particular harm materializes.” (Doe v.
Capital Cities (1996) 50 Cal.App.4th 1038, 1054.)
“A claim that an employer was negligent in hiring or retaining an
employee-driver rarely differs in substance from a claim that an employer
was negligent in entrusting a vehicle to the employee. Awareness,
constructive or actual, that a person is unfit or incompetent to drive underlies
a claim that an employer was negligent in hiring or retaining that person as
a driver. (See Judicial Council of Cal. Civ. Jury Instns. (2010) CACI
No. 426.)[ 17] That same awareness underlies a claim for negligent
contractor,” (Camargo, at p. 1241) but concluding that “an employee of a
contractor should be barred from seeking recovery from the hirer under the
theory of negligent hiring set forth in section 411,” (id. at p. 1244, italics
added)].) It is undisputed that McKenna is not an employee of Beesley, and
thus Camargo has no relevance to this case.
17 CACI No. 426 (2010 ed.) provided:
“[Name of plaintiff] claims that [he/she] was harmed by
[name of employee] and that [name of employer defendant]
is responsible for that harm because [name of employer
defendant] negligently [hired/ supervised/ [or] retained]
[name of employee]. To establish this claim, [name of
plaintiff] must prove all of the following:
“1. That [name of employee] was [unfit/ [or] incompetent] to
perform the work for which [he/she] was hired;
“2. That [name of employer defendant] knew or should have
known that [name of employee] was [unfit/ [or]
incompetent] and that this [unfitness/ [or] incompetence]
created a particular risk to others;
“3. That [name of employee]’s [unfitness/ [or] incompetence]
harmed [name of plaintiff]; and
14
entrustment. (See CACI No. 724.) In a typical case . . . the two claims are
functionally identical.” (Diaz, supra, 51 Cal.4th at p. 1157.)
2. The relationship of the common law to statutory law in this context
In determining the scope of common law tort duties pertaining to those
who allow unlicensed or unfit drivers to drive a vehicle, California courts
have long looked to statutory law. (See, e.g., Philadelphia Indemnity Ins. Co.
v. Montes-Harris (2006) 40 Cal.4th 151, 161 (Philadelphia Indemnity Ins. Co.)
[“As courts [considering common law claims for negligent entrustment] have
long recognized, the statutory provisions addressing vehicle use by
unlicensed drivers represent a legislatively expressed public policy to provide
protection to members of the public upon the streets and highways”];
Richards, supra, 43 Cal.2d at p. 63 [noting the relevance of statutory law in
determining “the scope of the duty of the owner of an automobile to control
his property for the protection of persons on the public streets”]; Osborn v.
Hertz Corp. (1988) 205 Cal.App.3d 703, 709 (Osborn) [observing that a
statute “prohibits a rental car agency from renting to unlicensed drivers,” and
concluding that “[a] rental car agency may therefore be liable for negligently
entrusting a car to an unlicensed driver”]; Dodge Center, supra,
199 Cal.App.3d at pp. 338–342 [discussing California statutory law
pertaining to unlicensed drivers in determining whether a seller of a motor
vehicle has a “statutory or common law duty to investigate a buyer’s driver’s
license” (id. at p. 336)]; Hartford Accident & Indemnity Co. v. Abdullah (1979)
94 Cal.App.3d 81, 92 (Hartford Accident & Indemnity Co.) [in considering
negligent entrustment of a vehicle cause of action, stating, “[t]wo sections of
the Vehicle Code are pertinent . . . in suggesting the standard of care
“4. That [name of employer defendant]’s negligence in
[hiring/ supervising/ [or] retaining] [name of employee] was
a substantial factor in causing [name of plaintiff]’s harm.”
15
required”]; Owens v. Carmichael’s U-Drive Autos, Inc. (1931) 116 Cal.App.
348, 352 (Owens) [stating that “violation of the statute [pertaining to
entrusting a car to an unlicensed person] is material,” in determining liability
for negligent entrustment of vehicle claim].)
3. Relevant statutes
The Vehicle Code contains two statutes pertaining to unlicensed
drivers that are relevant to our determination of the scope of the defendants’
duties in this case.
Section 14604, subdivision (a) provides:
“No owner of a motor vehicle may knowingly allow another
person to drive the vehicle upon a highway unless the
owner determines that the person possesses a valid driver’s
license that authorizes the person to operate the vehicle.
For the purposes of this section, an owner is required only
to make a reasonable effort or inquiry to determine
whether the prospective driver possesses a valid driver’s
license before allowing him or her to operate the owner’s
vehicle. An owner is not required to inquire of the
department whether the prospective driver possesses a
valid driver’s license.”
Section 14606, subdivision (a) provides:
“A person shall not employ, hire, knowingly permit, or
authorize any person to drive a motor vehicle owned by him
or her or under his or her control upon the highways unless
that person is licensed for the appropriate class of vehicle
to be driven.”
C. The trial court erred in granting judgment as a matter of law in favor of
Smoothreads on McKenna’s negligent entrustment cause of action
McKenna argues that the trial court erred in granting judgment as a
matter of law in favor of Smoothreads on his negligent entrustment cause of
action. McKenna contends, “In light of the [defendants’] legal duty to inquire
16
into whether Wells had a valid driver’s license, a reasonable jury could find
Smoothreads liable for negligent entrustment.” (Boldface & some
capitalization omitted). Specifically, McKenna contends that a jury could
reasonably find that Smoothreads breached its duty to determine whether
Wells had a valid driver’s license and could rely on this finding in
determining that Smoothreads had constructive knowledge that Wells was
incompetent or unfit to drive. Thus, McKenna maintains that the trial court
erred in granting judgment as a matter of law for Smoothreads on McKenna’s
negligent entrustment cause of action on the ground that McKenna would be
unable to establish the constructive knowledge element of that cause of
action.
1. An owner of a motor vehicle has a duty to make a reasonable effort
or inquiry to determine whether a prospective driver has a valid
driver’s license before allowing the prospective driver to operate the
owner’s vehicle; an owner who breaches this duty, and permits an
unlicensed driver to drive the owner’s vehicle, may be found to have
constructive knowledge of the driver’s incompetence to drive for
purposes of a claim for negligent entrustment of a motor vehicle
a. Negligent entrustment of a motor vehicle
In California, “ ‘one who places or entrusts his [or her] motor vehicle in
the hands of one whom he [or she] knows, or from the circumstances is
charged with knowing, is incompetent or unfit to drive, may be held liable for
an injury inflicted by the use made thereof by that driver, provided the
plaintiff can establish that the injury complained of was proximately caused
by the driver’s disqualification, incompetency, inexperience or
recklessness. . . . [¶] . . . [¶] Under the theory of “negligent entrustment,”
liability is imposed on [the] vehicle owner or permitter because of his [or her]
own independent negligence and not the negligence of the driver, in the event
plaintiff can prove that the injury or death resulting therefrom was
17
proximately caused by the driver’s incompetency.” (Syah v. Johnson (1966)
247 Cal.App.2d 534, 539 (Syah).)
However, at common law, “[i]n the absence of . . . a statute . . . it has
generally been held that the owner of an automobile is under no duty to
persons who may be injured by its use to keep it out of the hands of a third
person in the absence of facts putting the owner on notice that the third
person is incompetent to handle it.” (Richards, supra, 43 Cal.2d at p. 63,
italics added.) The tort of negligent entrustment of a motor vehicle ordinarily
required “demonstration of actual knowledge of facts showing or suggesting
the driver’s incompetence.” (Dodge Center, supra, 199 Cal.App.3d at p. 341,
italics added.)
California statutory law has long provided that a factfinder may find
that an owner should have known of the prospective driver’s incompetence if
the owner knows that the prospective driver is not appropriately licensed. In
Owens, supra, 116 Cal.App. 348, the Court of Appeal considered whether a
person injured by an unlicensed driver could maintain a cause of action for
negligent entrustment against the owner of the vehicle. Citing a predecessor
statute to section 14606, the Owens court concluded that the injured person
could make out a prima facie case against the owner, given evidence that the
owner knew that the driver was unlicensed, reasoning in part:
“[Former section 76 of the California Vehicle Act 18] now
requires the examination of all persons applying for
18 Former section 76 of the California Vehicle Act provided:
“Unlawful to employ unlicensed chauffeur. No person shall
employ for hire as a chauffeur of a motor vehicle, any
person not licensed as in this act provided. No person shall
authorize or knowingly permit a motor vehicle owned by
18
licenses, and an operator’s license is no longer merely a
means of identification but is in effect a certificate
evidencing the fact that the holder had demonstrated his
competency. Under these circumstances, we believe that
the violation of the statute is material. [Citations.] The
distinction between violations of statutes which are
designed for the protection of the public and violations of
statutes which have no such purpose is pointed out in
Austin v. Rochester Folding Box Co., 111 Misc. 292. In our
opinion, where an examination is required to test the
competency of the applicant before the issuance of an
operator’s license and it is provided by statute that no
person shall knowingly permit his motor vehicle to be
driven by an unlicensed person, a showing of a violation of
the statute by the owner makes out a prima facie case
against him in favor of a person who has sustained injury
through the negligence of such unlicensed driver. (Correira
v. Liu, 28 Haw., 145.) As is said in the concurring opinion
in that case at page 154, ‘The fact that Miller was
unlicensed is evidence prima facie in the eyes of the law
that Miller was incompetent and that Correira committed a
breach of his common–law duty not to entrust his car to a
driver who was known by him to be incompetent or who,
under the circumstances, should have been known by him
to be incompetent and was sufficient to put Correira upon
inquiry as to Miller’s competency or incompetency.’ ”
(Owens, supra, 116 Cal.App. at pp. 351–352, some italics
omitted.)
The importance of statutory law in determining the scope of a common
law liability for negligent entrustment was also apparent in both Dodge
Center, supra, 199 Cal.App.3d 332 and Osborn, supra, 205 Cal.App.3d 703.
In Dodge Center, the Court of Appeal concluded that a seller of a motor
vehicle could not be held liable for negligent entrustment by plaintiffs who
him or under his control, to be driven by any person who
has no legal right to do so or in violation of the provisions of
this act.” (Stats. 1923, ch. 266, § 76.)
19
were injured in a motor vehicle accident with the unlicensed purchaser of the
vehicle. (Dodge Center, supra, at pp. 335, 342.) The Dodge Center court
reasoned that the sellers “owed no legal duty” to plaintiffs “to inquire into
[the purchaser’s] driving record before selling him a vehicle.” (Id. at p. 342.)
The Dodge Center court noted that section 14608 “imposes . . . a duty [of
inquiry] on one who rents a motor vehicle, requiring inspection of the driver’s
license of the person to whom the vehicle is to be rented and comparison of
the signature on the license with that of the person seeking to rent.” (Id. at
pp. 338–339.) In contrast, the Dodge Center court noted, “no statute imposes
on such a retailer a duty to inquire as to the purchaser’s license status.” (Id.
at p. 338.) The Dodge Court reasoned that, “the Legislature could readily
have imposed a duty of inquiry upon motor vehicle sellers, as it did, for
example, upon those who rent motor vehicles, in section 14608.” (Id. at
p. 342.)
Just a few months later in Osborn, the Court of Appeal succinctly
stated that a rental car agency’s violation of section 14608 could subject the
agency to common law liability for negligent entrustment:
“[S]ection 14608 prohibits a rental car agency from renting
to unlicensed drivers. . . . A rental car agency may
therefore be liable for negligently entrusting a car to an
unlicensed driver.” (Osborn, supra, 205 Cal.App.3d at
p. 709.)
20
b. Section 14604 19
In 1994, approximately six years after the Court of Appeal decisions in
Dodge Center and Osborn, the Legislature enacted section 14604,
subdivision (a), which specifically imposed a duty of inquiry on all owners of
motor vehicles who permissively allow another to drive their vehicles to
determine that the permissive driver has a valid driver’s license. (Stats.
1994, ch. 1221, § 14.) As noted in part III.B.3, ante, section 14604,
subdivision (a) prohibits an “owner of a motor vehicle,” from “knowingly
allow[ing] another person to drive the vehicle . . . unless the owner determines
19 While McKenna raises the applicability of section 14604 on appeal, his
trial counsel failed to cite section 14604, subdivision (a) in the trial court.
However, we may consider the statute’s applicability to this case for the first
time on appeal for the following reasons.
First, McKenna’s opposition to Smoothreads’s motion for summary
judgment did present the argument that Smoothreads had a duty to inquire
as to Wells’s license status. (Compare with Noe v. Superior Court (2015)
237 Cal.App.4th 316, 335–336 (Noe) [“We generally will not consider an
argument ‘raised in an appeal from a grant of summary judgment . . . if it
was not raised below and requires consideration of new factual questions’ ”)
Further, even if it could be said that McKenna is presenting a new
issue on appeal, a court reviewing a summary judgment “may . . . consider a
newly[-]raised issue ‘when [it] involves purely a legal question which rests on
an uncontraverted record which could not have been altered by the
presentation of additional evidence.’ ” (Noe, supra, at p. 336, italics added.)
“The existence of a legal duty is a question of law for the court” (John B. v.
Superior Court (2006) 38 Cal.4th 1177, 1188), as is the interpretation of
section 14604 (see, e.g., Goodman v. Lozano (2010) 47 Cal.4th 1327, 1332
[“the issue here involves the interpretation of a statute, a question of law”]),
and defendants present no argument that our analysis of either issue could
have been altered by the presentation of additional evidence.
Finally, defendants do not argue in their briefing that McKenna
forfeited reliance on section 14604, subdivision (a) by failing to cite the
statute in the trial court. Under these circumstances, we conclude that it is
appropriate to consider the applicability of section 14604, subdivision (a) to
McKenna’s claim.
21
that the person possesses a valid driver’s license that authorizes the person to
operate the vehicle.” (Italics added.) The statute further specifies that the
owner is required “to make a reasonable effort or inquiry to determine
whether the prospective driver possesses a valid driver’s license before
allowing him or her to operate the owner’s vehicle.” (Ibid., italics added.)
Thus, section 14604, subdivision (a) expressly provides that an owner has a
legal duty to make a “reasonable effort or inquiry,” into a prospective driver’s
license status before allowing the prospective driver to operate the owner’s
vehicle. 20
Case law discussing section 14604 describes an owner’s duty in a
manner consistent with its text. (See Philadelphia Indemnity Ins. Co., supra,
40 Cal.4th at p. 161 [“section 14604 prohibits an owner of a motor vehicle
from knowingly allowing another person to drive its vehicle without first
determining that the person possesses a valid and appropriate driver’s
license”]; Smith v. Santa Rosa Police Dept. (2002) 97 Cal.App.4th 546, 563
20 Section 14604, subdivision (b) provides:
“A rental company is deemed to be in compliance with
subdivision (a) if the company rents the vehicle in
accordance with Sections 14608 and 14609.”
Section 14608 provides additional requirements pertaining to those
who rent motor vehicles to members of the public, including, as noted by the
courts in Dodge Center, supra, 199 Cal.App.3d at pages 338–339 and Osborn,
supra, 205 Cal.App.3d at page 709, footnote 3, prohibiting the renting of a
motor vehicle unless “[t]he person renting to another person has inspected
the driver’s license of the person to whom the vehicle is to be rented and
compared either the signature thereon with that of the person to whom the
vehicle is to be rented or the photograph thereon with the person to whom the
vehicle is to be rented.” (§ 14608, subd. (a)(2).) Section 14609 contains record
keeping requirements related to the license inspection requirements of
section 14608.
22
(Smith) [describing “the mandate of section 14604 that the registered and
legal owner of the vehicle must inquire about the license status of the driver
to whom the owner lends the vehicle” and referring to “section 14604’s duty of
inquiry” 21 (id. at p. 565)].)
c. The effect of section 14604 on common law liability for
negligent entrustment of a motor vehicle
In considering the effect of the enactment of section 14604,
subdivision (a) on the common law tort of negligent entrustment, we begin by
observing that the Philadelphia Indemnity Ins. Co. court noted that “the
enactment of section 14604 in 1994 was part of an overall legislative effort to
address the serious public safety danger posed by unlicensed drivers and
drivers with suspended or revoked licenses.” (Philadelphia Indemnity Ins.
Co., supra, 40 Cal.4th at p. 162; Smith, supra, 97 Cal.App.4th at p. 565
[section 14604 was part of a legislative effort “aimed at reducing the
incidence of unlicensed driving and punishing such behavior”].)
As part of this “overall legislative effort” (Philadelphia Indemnity Ins.
Co., supra, 40 Cal.4th at p. 162), the Legislature adopted, as statutory law,
the following findings, detailing these significant public safety dangers:
“The Legislature finds and declares all of the following:
“(a) Driving a motor vehicle on the public streets and
highways is a privilege, not a right.
“(b) Of all drivers involved in fatal accidents, more than
20 percent are not licensed to drive. A driver with a
suspended license is four times as likely to be involved in a
fatal accident as a properly licensed driver.
21 To be precise, section 14604, subdivision (a) specifies a duty of
“reasonable effort or inquiry.” However, for purposes of brevity, we employ
the Smith court’s “duty of inquiry” (Smith, supra, 97 Cal.App.4th at p. 565)
shorthand description of the statutory requirement through this opinion.
23
“(c) At any given time, it is estimated by the Department of
Motor Vehicles that of some 20 million driver’s licenses
issued to Californians, 720,000 are suspended or revoked.
Furthermore, 1,000,000 persons are estimated to be driving
without ever having been licensed at all.
“(d) Over 4,000 persons are killed in traffic accidents in
California annually, and another 330,000 persons suffer
injuries.
“(e) Californians who comply with the law are frequently
victims of traffic accidents caused by unlicensed drivers.
These innocent victims suffer considerable pain and
property loss at the hands of people who flaunt [sic] the
law. The Department of Motor Vehicles estimates that
75 percent of all drivers whose driving privilege has been
withdrawn continue to drive regardless of the law.” 22
(§ 14607.4)
In Smith, the court observed that, although section 14604 is a criminal
statute, 23 the statute could potentially serve as the basis for a negligence
finding in a civil action:
22 The findings were enacted pursuant to Statutes 1994, chapter 1133,
section 11, companion legislation to Statutes 1994, chapter 1221, section 14,
which enacted section 14604. (See Smith, supra, 97 Cal.App.4th at p. 563
[describing the two statues as “companion pieces of legislation, aimed at
reducing the harm caused by drivers with suspended, revoked or no
licenses”].)
23 Violation of section 14604 is a misdemeanor. Section 40000.11 provides
in relevant part:
“A violation of any of the following provisions is a
misdemeanor, and not an infraction:
“[¶] . . . [¶]
“(m) Section 14604, relating to unlawful use of a vehicle.”
24
“[S]ection 14604 is a criminal statute. . . . [S]ection 14604
imposes criminal liability upon an owner who knowingly
allows another person to drive the owner’s vehicle without
first determining the driver possesses a valid driver’s
license. . . . That standard for criminal liability could
conceivably furnish a basis for a negligence finding in a
civil action for damages against an owner who did not make
a reasonable effort to determine whether the prospective
driver possessed a valid license before allowing the driver to
operate the owner’s vehicle where injuries were proximately
caused thereby. (See Evid. Code, § 669[ 24]; see generally
6 Witkin, Summary of Cal. Law (9th ed. 1988) Torts §§ 818,
819, pp. 170–173 [violation of a criminal statute may
constitute negligence per se].)” (Smith, supra,
97 Cal.App.4th at p. 565, italics added.) 25
While we do not consider here whether a violation of section 14604
constitutes negligence per se, 26 we agree with the opinion in Smith insofar
24 Evidence Code section 669 outlines the requirements for establishing
negligence per se.
25 In Smith, the court considered a question of statutory interpretation
related to the relationship between section 14604 and section 14602.6, which
allows for the impounding of a motor vehicle driven by an unlicensed driver
and provides an owner with a hearing to “ ‘consider any mitigating
circumstances attendant to[ ] the storage,’ ” (Smith, supra, 97 Cal.App.4th at
p. 549.) Specifically, the Smith court considered whether section 14602.6
conditions “the operation of the mitigating circumstances exception to
situations where the owner has made a reasonable inquiry as to the licensed
status of the driver before lending the vehicle.” (Smith, supra, at p. 550.)
While the Smith court’s interpretation of section 14602.6 is not germane to
the present appeal, the Smith court’s observations as to the relationship
between section 14604 and a civil action for damages based on negligence, are
relevant.
26 “ ‘[T]he doctrine of negligence per se is not a separate cause of action,
but creates an evidentiary presumption that affects the standard of care in a
cause of action for negligence,’ ” (Turner v. Seterus, Inc. (2018) 27 Cal.App.5th
25as it can be interpreted to state that the enactment of section 14604,
subdivision (a) is relevant in determining the scope of an owner’s duty for
purposes of a claim of negligent entrustment of a motor vehicle. Just as the
court in Owens concluded that negligent entrustment liability may be
premised on a violation of a statutory predecessor to section 14606 (Owens,
supra, 116 Cal.App. at p. 351), and the Osborn court stated that negligent
entrustment liability may be premised on a violation of section 14608
(Osborn, supra, 205 Cal.App.3d at p. 709), we conclude, for reasons explained
further below, that an owner who violates section 14604 may be liable for
negligent entrustment.
It is true, as Smoothreads points out in its brief, that section 14604,
subdivision (a) establishes an affirmative duty to inquire regarding a
prospective driver’s license status, while a negligent entrustment claim
requires either actual or constructive knowledge of a prospective driver’s
incompetence or lack of fitness to drive. (Compare § 14604, subd. (a) [“No
owner of a motor vehicle may knowingly allow another person to drive the
vehicle upon a highway unless the owner determines that the person
possesses a valid driver’s license that authorizes the person to operate the
vehicle” (italics added)] with CACI No. 724 [listing as an element of a
negligent entrustment cause of action “[t]hat [name of defendant] knew, or
516, 534). McKenna presents no argument on appeal concerning the doctrine
of negligence per se, and we therefore have no occasion to consider its
potential applicability in this case.
We also reject Smoothreads’s characterization of McKenna’s argument
as “essentially a negligence per se, almost a strict liability, argument.”
McKenna’s briefing makes clear that his argument is that “(1) constructive
knowledge of an unlicensed driver puts an owner ‘on inquiry [notice]’ of
incompetence; and (2) it is for [a] jury to determine under those
circumstances whether the owner was negligent in permitting the driver to
operate the vehicle.” (Quoting Syah, supra, 247 Cal.App.2d at p. 545.)
26
should have known, that [name of driver] was incompetent or unfit to drive
the vehicle” (some italics added)].)
However, a jury that finds that an owner failed to comply with the
affirmative statutory duty to make a “reasonable effort or inquiry” (§ 14604,
subd. (a)) into a prospective driver’s license status could reasonably rely on
that finding in determining that the owner should have known that the
prospective driver “was incompetent or unfit to drive the vehicle.” 27 (CACI
No. 724, italics added; see e.g., Hartford Accident & Indemnity Co., supra,
94 Cal.App.3d at p. 92.) As the court in Dodge Center stated, “The fact that
the driver is unlicensed makes a prima facie case of negligence in allowing
him to drive the vehicle.” (Dodge Center, supra, 199 Cal.App.3d at p. 341,
fn. 3. [citing cases].)
In Hartford Accident & Indemnity Co., the court considered whether a
car dealer could be liable for negligent entrustment where the dealer made no
inquiry into the license status of a prospective customer before allowing the
prospective customer to test drive a vehicle. After citing former sections
14606 and 14608, 28 the Hartford Accident & Indemnity Co. court reasoned:
27 Or, as McKenna states in his reply brief, “constructive knowledge of no
license supports constructive knowledge of incompetence.” (Italics omitted.)
28 The Hartford Accident & Indemnity Co. court noted that former section
14606 provided in relevant part that “ ‘(n)o person shall . . . knowingly permit
or authorize the driving of a motor vehicle, owned by him or under his
control, upon the highways by any person unless the person is then licensed
for the appropriate class of vehicle to be driven,’ ” and that former section
14608 provided in relevant part, “ ‘(n)o person shall rent a motor vehicle to
another unless . . . [the] person renting to another person has inspected the
driver’s license of the person to whom the vehicle is to be rented and
compared the signature thereon with the signature of such person written in
his presence.’ ” (Hartford Accident & Indemnity Co., supra, 94 Cal.App.3d at
p. 92, quoting former §§ 14606, 14608.)
27
“Taken together, these sections attempt to ensure that only
licensed drivers will operate vehicles on the streets and
highways in this state; the protected class are members of
the public using those streets and highways. We think it
clear that ‘ordinary care and skill’ on the part of a used car
dealer requires inquiry of persons wishing to test drive the
dealer’s cars as to whether or not they are validly licensed
drivers. Those persons who cannot produce a valid license
to operate such automobiles test drive at the dealer’s peril.”
(Hartford Accident & Indemnity Co., supra, 94 Cal.App.3d
at p. 92.)
Similarly, in this case, section 14604 reflects a further legislative effort
to reduce the public safety dangers posed by unlicensed drivers, by requiring
all owners of motor vehicles to exercise “reasonable effort or inquiry”
(§ 14604, subd. (a)) into a prospective driver’s license status before allowing
the prospective driver to drive the owner’s vehicle. (See Philadelphia
Indemnity Ins. Co., supra, 40 Cal.4th at p. 161.) An owner who allows its
vehicle to be driven without fulfilling his duty allows the unlicensed driver to
drive the vehicle at the owner’s peril.
Thus, given the enactment of “section 14604’s duty of inquiry” (Smith,
supra, 97 Cal.App.4th at p. 565), 29 the Dodge Center court’s statement that,
29 We are not persuaded by Smoothreads’s argument, quoting Dodge
Center and citing Richards, that “[t]o impose a ‘duty of inquiry,’ where there
was no actual knowledge of unfitness, would ‘not only be without precedent’
but ‘would also violate the general principle that it may be presumed that
every person will obey the law.’ ” As the Smith court made clear, it is the
Legislature that imposed the “duty of inquiry” (Smith, supra, 97 Cal.App.4th
at p. 565) that we apply here, and section 14604 provides the legal
“precedent,” that was lacking in Dodge Center, supra, at 199 Cal.App.3d at
page 342. As noted, section 14604 was enacted six years after Dodge Center
was decided.
Further, while the Richards court stated that “[o]rdinarily . . . there is
no duty to control the conduct of a third person so as to prevent him from
causing harm to another” (Richards, supra, 43 Cal.2d at p. 65, italics added),
28
under California law, “there can be no liability [for negligent entrustment]
unless permission to drive is given to one known to be unlicensed,” is no
longer correct. 30 (Dodge Center, supra, 199 Cal.App.3d at p. 339; citing
Johnson v. Casetta (1961) 197 Cal.App.2d 272, 274 [sellers of motor vehicle
could not be liable for negligent entrustment because sellers had no
knowledge purchaser was “an inexperienced, incompetent and unlicensed
driver,” and “in the absence of any such knowledge, they had no legal duty or
obligation to inquire”].)
We therefore conclude that a jury may reasonably find that an owner of
a vehicle had constructive knowledge that a prospective driver was
incompetent or unfit to drive if there is evidence from which the jury could
reasonably find that the owner breached its section 14604 duty to inquire as
to a prospective driver’s license status and allowed an unlicensed driver to
the Richards court repeatedly emphasized that this was true only “[i]n the
absence of . . . a statute,” establishing such duty. (Id. at p. 63, italics added;
see id. at p. 65 [“[i]n the absence of [a] statute”]; id. at p. 67 [“in the absence
of [a] statute”].) In this case, there is such a statute—section 14604.
30 In fact, in our view, the Dodge Center Court’s statement as to the
requirement of actual knowledge on the part of the owner was not entirely
correct at the time it was made. As noted in the text, in Hartford Accident &
Indemnity Co., the Court of Appeal concluded that a cause of action at
common law for negligent entrustment of a motor vehicle had been properly
stated against a car dealer who permitted an unlicensed driver to test drive a
vehicle premised on the dealer’s breach of the duty to inquire as to the
driver’s license status. (Hartford Accident & Indemnity Co., supra,
94 Cal.App.3d at p. 92.) The Hartford Accident & Indemnity Co. court
specifically stated that “no one [from the dealership] asked [the driver] if he
possessed a valid driver’s license,” (id. at p. 87) and there is nothing in the
opinion suggesting that the dealer knew the driver was unlicensed.
Accordingly, we are unpersuaded by Smoothreads’s argument, citing Dodge
Center, that an “unbroken line of authority requiring actual knowledge,” of a
driver’s lack of a license is required in order for a plaintiff to prevail on a
claim for negligent entrustment of a motor vehicle.
29
drive the owner’s vehicle. We further conclude that a defendant/owner fails
to meet its summary adjudication burden of establishing that a plaintiff
cannot establish the constructive knowledge element of a negligent
entrustment of a motor vehicle claim, 31 where there is evidence from which a
jury could reasonably find that an owner of a vehicle breached its section
14604 duty and allowed an unlicensed driver to drive its vehicle.
For the reasons discussed below, we conclude that there is such
evidence in this case.
2. The trial court erred in granting judgment as a matter of law in
favor or Smoothreads on the ground that McKenna would be unable
to establish the constructive knowledge element of his negligent
entrustment cause of action
With respect to the evidence from which a reasonable jury could find
that Smoothreads breached its section 14604 duty as the owner of a vehicle 32
to “make a reasonable effort or inquiry to determine whether the prospective
driver possesses a valid driver’s license before allowing him . . . to operate the
owner’s vehicle” (§ 14064, subd. (a)), McKenna presented evidence that
Beesley 33 did not ask Wells whether he had a valid driver’s license before
permitting Wells to drive Smoothreads’s vehicle. Specifically, McKenna
lodged Wells’s deposition testimony in which Wells was asked, “Did [Beesley]
31 As discussed in part III.A, ante, for “purposes of motions for summary
judgment and summary adjudication . . . [a] defendant . . . has met his or her
burden of showing that a cause of action has no merit if the party has shown
that one or more elements of the cause of action . . . cannot be
established . . . .” (Code Civ. Proc., § 437c, subd. (p); see Camacho, supra,
24 Cal.App.5th at p. 296 [summarizing summary judgment burdens].)
32 It is undisputed that Smoothreads owned the vehicle in question.
33 Smoothreads does not dispute that Beesley acted on its behalf.
30
ever request any driving information from you about whether you had DUI
convictions, whether you had a suspended license or whether you even had a
valid license?” Wells responded, “No.” McKenna lodged another portion of
Wells’s deposition, during which the following colloquy occurred:
“Q: Did you tell the Beesleys you didn’t have a driver’s
license?
“A: They never asked.
“Q: Did you tell them?
“A: I didn’t tell them because they never asked.”
Based on this testimony, a reasonable jury could find that
Smoothreads 34 failed to make “a reasonable effort or inquiry to determine
whether [Wells] possesse[d] a valid driver’s license before allowing him . . . to
operate [Smoothreads’s] vehicle.” (§ 14604, subd. (a).)
Smoothreads’s argument to the contrary is not persuasive.
Smoothreads argues:
“If someone drives their car to your house one day, and
asks to borrow your car the next, you do not have reason to
suspect they are unlicensed or an unfit driver. Even less if
that someone is an adult whose job (here, contractor)
is commonly understood to require use of a vehicle.”
Section 14604, subdivision (a) does not condition its applicability on
instances in which an owner has “reason to suspect,” that a prospective
driver does not have a license. Rather, as recounted throughout this opinion,
the statute mandates, without qualification, that the owner “make a
reasonable effort or inquiry,” into the prospective driver’s license status
34 Smoothreads does not contend that someone other than Beesley acted
on its behalf with respect to the Smoothreads’s vehicle in determining Wells’s
license status or competency to drive.
31
before allowing the prospective driver to use the owner’s vehicle. (§ 14604,
subd. (a).) In light of the evidence discussed above, we conclude that a jury
could reasonably find that Smoothreads did not satisfy its duty to make “a
reasonable effort or inquiry,” to determine whether Wells had a valid driver’s
license before allowing Wells to drive Smoothreads’s vehicle. 35
With respect to whether there is evidence that Smoothreads allowed an
unlicensed driver to drive its vehicle, Smoothreads conceded for purposes of
its summary adjudication motion that it permitted Wells to drive its vehicle
that was involved in the accident, and it is undisputed that Wells did not
possess a valid driver’s license at the time of the accident.
Accordingly, we conclude that the jury could reasonably find that
Smoothreads had constructive knowledge that Wells was incompetent or
unfit to drive and that Smoothreads allowed an unlicensed driver to drive its
vehicle. We therefore further conclude that the trial court erred in granting
judgment as a matter of law because Smoothreads did not demonstrate that
McKenna would be unable to establish the constructive knowledge element of
his negligent entrustment cause of action against it. 36
35 Stated differently, Smoothreads did not establish that McKenna would
be unable to prove that Smoothreads breached its duty under section 14604.
36 McKenna and Smoothreads both make arguments pertaining to a
separate element of McKenna’s negligent entrustment claim against
Smoothreads, i.e., whether Wells’s incompetence or unfitness to drive was a
substantial factor in causing harm to McKenna (i.e., proximate cause
element). For example, McKenna argues, “[A] reasonable jury could find that
Smoothreads’[s] breach of its duty to inquire into Wells’ licensure status was
the ‘but for’ cause of the collision.” Smoothreads argues, “The accident was
not caused by Wells’s lack of a license.”
Smoothreads did not move for summary adjudication on the ground
that McKenna would be unable to prove the proximate cause element of his
negligent entrustment cause of action. On the contrary, the sole basis on
32
D. The trial court erred in granting judgment as a matter of law in favor of
Beesley on McKenna’s negligent hiring cause of action
McKenna claims that the trial court erred in granting judgment as a
matter of law in favor of Beesley on McKenna’s negligent hiring claim.
Specifically, McKenna argues that the trial court erred in concluding that
McKenna could not establish that Beesley knew or should have known that
Wells was unfit or incompetent to drive, as required to prove a negligent
hiring claim.
1. The precise nature of the appellate claim at issue
At the outset, we clarify our understanding of the nature of the
appellate claim at issue. While McKenna correctly states that a negligent
hiring claim technically is a “separate cause of action,” from a negligent
entrustment claim, he notes the close relationship between the two causes of
action, stating, “In the context of entrusting a vehicle to a hired worker, a
claim of negligent hiring is generally equivalent to a claim of negligent
entrustment” (italics omitted). (Citing Diaz, supra, 51 Cal.4th at p. 1157; see
ibid. [negligent hiring and negligent entrustment “claims are functionally
identical” in this context]; see also ibid. [referring to a single “claim against
the employer—for negligent entrustment, hiring, or retention” (italics
added)].) Negligent hiring in this context and negligent entrustment of a
which Smoothreads sought summary adjudication of McKenna’s negligent
entrustment cause of action was its contention that “[McKenna] [cannot]
present any triable issue of fact to demonstrate the actual or constructive
knowledge required to prevail on a negligent entrustment theory.” Further,
the trial court granted Smoothreads’s motion for summary adjudication solely
on the constructive knowledge element and did not discuss proximate cause
in any manner in its ruling. Thus, we have no occasion to consider the
parties’ contentions as to the proximate cause element of McKenna’s
negligent entrustment cause of action.
33
motor vehicle are both premised on “[a]wareness [by the defendant],
constructive or actual, that a person is unfit or incompetent to drive.” (Ibid.)
Thus, we understand McKenna to be arguing that there is a triable
issue of fact as to whether Beesley may be liable for negligent hiring based on
Beesley’s allegedly wrongful act of entrusting a vehicle to Wells. 37
Specifically, McKenna claims that the trial court erred in concluding that
McKenna would be unable to establish that “Beesley knew or should have
known (A) that Wells was unfit or incompetent to drive and (B) that this
unfitness or incompetence created a particular risk to others.” (Quoting
CACI. No. 426 [outlining the elements of a claim for negligent hiring].) 38
37 Our understanding of McKenna’s claim is further supported by the fact
that McKenna does not seek to hold Beesley liable for any allegedly negligent
act other than Beesley’s alleged negligence in entrusting Wells with a vehicle.
Further, we analyze Beesley’s liability solely as the hirer and not as the
person through whom Smoothreads, the owner of the vehicle in question,
acted.
38 The close relationship between negligent hiring and negligent
entrustment theories of liability against Beesley is further supported by the
fact that neither the allegations of McKenna’s complaint, nor Beesley’s
motion for summary judgment, nor the trial court’s order granting summary
judgment draw clear distinctions between negligent hiring and negligent
entrustment theories of liability with respect to Beesley. (See pt. II.A, C, E,
ante.) Thus, as we state in the text, we understand McKenna to be arguing
that Beesley may be liable for negligent hiring based on his act of hiring
Wells and wrongfully entrusting a vehicle to Wells.
34
2. A person who hires another and permits that person to drive a
vehicle under the hirer’s control has a duty to make a reasonable
effort or inquiry to determine whether the hiree has a valid driver’s
license; a hirer who breaches this duty, and who permits an
unlicensed driver to drive the vehicle, may be found to have
constructive knowledge of the hiree’s incompetence to drive for
purposes of a negligent hiring claim
We are not aware of any authority, and neither party has cited any,
that addresses whether a person who hires another to drive a vehicle under
the hirer’s control has a duty to make a reasonable effort or inquiry to
determine whether the hiree has a valid driver’s license. (See § 14606,
subd. (a) [“A person shall not employ, hire, knowingly permit, or authorize
any person to drive a motor vehicle owned by him or her or under his or her
control upon the highways unless that person is licensed for the appropriate
class of vehicle to be driven”]; cf. § 14604, subd. (a) [mandating that an owner
of a vehicle make a “reasonable effort or inquiry” into whether the
prospective driver possesses a valid driver’s license].) 39 Nor are we aware of
any authority involving whether a hirer who breaches that duty, and who
permits an unlicensed driver to drive the vehicle, may be found to have
constructive knowledge of the hiree’s incompetence to drive for purposes of a
negligent hiring claim.
39 We are aware that section 14604 applies, by its terms, to owners, and
Beesley did not own the vehicle in question. However, Beesley did hire Wells,
and section 14606 prohibits the hiring of a person to drive a vehicle when the
hiree lacks a driver’s license, irrespective of whether the hirer has knowledge
of the hiree’s lack of a driver’s license. Thus, and for reasons we explain in
more detail in the text, in defining the scope of common law duties with
reference to the statutory scheme, we conclude that, at a minimum, given
that the Legislature required owners to make a “reasonable effort or inquiry”
(§ 14604) into whether a permissive driver has a driver’s license, hirers have
such a duty of inquiry, as well.
35
As we explain below, Dodge Center, the principal case that Beesley and
the trial court relied on, was never authority as to a hirer’s duty under
section 14606, and Dodge Center was based on case law that is no longer
controlling in the wake of the enactment of section 14604, subdivision (a).
First, Dodge Center considered only whether a seller of motor vehicles could
be liable pursuant to common or statutory law 40 in light of the portion of
section 14606, subdivision (a) that prohibits a person from knowingly
permitting another to drive a vehicle without a driver’s license. (Dodge
Center, supra, 199 Cal.App.3d at p. 338.) The Dodge Center court did not
consider the applicability of section 14606, subdivision (a) to one who
“employ[s] [or] hire[s]” a person to drive. (Ibid., italics added; see Dodge
Center, supra, at p. 338.) Indeed, the Dodge Center court did not mention the
“employ, hire” text of section 14606, subdivision (a); the court instead
repeatedly referred to the requirement that the defendant have “knowingly”
entrusted a vehicle to an unlicensed driver, a requirement that the
Legislature did not apply to those who “employ” or “hire” a driver. For
example, the Dodge Center court stated:
“[S]ection 14606, subdivision (a) in relevant part provides
that no person shall ‘knowingly permit or authorize the
driving of a motor vehicle, owned by him or under his
control, upon the highways by any person unless the person
is then licensed for the appropriate class of vehicle to be
driven.’ This statute (and its predecessors) make a motor
vehicle owner who knowingly entrusts his vehicle to an
unlicensed driver liable for a third party’s injuries caused
by the driver’s negligence.” (Dodge Center, supra, at p. 338,
italics added.)
40 The Dodge Center court stated that a cause of action pursuant to
section 14606 “parallels that at common law for negligent entrustment.”
(Dodge Center, supra, 199 Cal.App.3d at p. 338.)
36
Second, Dodge Center lacks persuasive force because the court relied on
case law requiring that a person have actual knowledge of a prospective
driver’s lack of a driver’s licensure that predated the enactment of section
14604, subdivision (a). (See Dodge Center, supra, 199 Cal.App.3d at p. 338
[“the common law cause of action for entrustment, requires a showing of
knowledge of the incapacitating condition, which under the statute[ 41] is lack
of a license. In the absence of such knowledge there is no duty to inquire”
(italics added)].) We concluded in part III.C, ante, that, in light of the
enactment of a “duty of inquiry” (Smith, supra, 97 Cal.App.4th at p. 565) in
section 14604, subdivision (a), a jury may find the constructive knowledge
element of a negligent entrustment claim against an owner to be proven
without proof that the owner had actual knowledge of a prospective driver’s
license status, in light of the owner’s duty to inquire into the license status. 42
Indeed, the Dodge Center court suggested the significance of a statute
imposing such a duty:
“As Dodge points out, the Legislature could readily have
imposed a duty of inquiry upon motor vehicle sellers, as it
did, for example, upon those who rent motor vehicles, in
section 14608. Sections 14606 and 14608 were enacted
during the same legislative session as part of the same
statute. [Citation.] Since that time, section 14606 has
been amended three times, but no language has been
41 The Dodge Center court was referring to section 14606, subdivision (a).
However, as noted in the text, the Dodge Center court did not consider the
applicability of section 14606, subdivision (a) to one who “employ[s] [or]
hire[s].” (Ibid.)
42 As we explained in part III.C, ante, a jury may reasonably find that an
owner of a vehicle had constructive knowledge that a prospective driver was
incompetent or unfit to drive if there is evidence from which the jury could
reasonably find that the owner breached its duty under section 14604 and
allowed an unlicensed driver to drive its vehicle.
37
inserted requiring a seller to examine the purchaser’s
license. [Citations.]” (Dodge Center, supra, 199 Cal.App.3d
at p. 342.)
As discussed in part III.C, ante, six years after Dodge Center was
decided, with the enactment of section 14604, subdivision (a), the Legislature
has imposed a “duty of inquiry” (Smith, supra, 97 Cal.App.4th at p. 565) on
the owner of a vehicle who allows another person to drive the owner’s
vehicle. 43
In considering a hirer’s common law duties in this context, we observe
that section 14606, subdivision (a)’s prohibition 44 on “hir[ing] . . . any person
to drive a motor vehicle owned by him or her or under his or her control upon
the highways unless that person is licensed for the appropriate class of
vehicle to be driven,” contains no requirement that those who “employ” or
“hire” another (ibid.) have knowledge of the fact that the hiree does not
possess a valid driver’s license. Rather, section 14606, subdivision (a)
prohibits, without qualification, hiring a person who lacks an appropriate
driver’s license. (Ibid. [“A person shall not employ, hire, knowingly permit, or
authorize any person to drive a motor vehicle owned by him or her or under
his or her control upon the highways unless that person is licensed for the
appropriate class of vehicle to be driven” (italics added)].) Thus, a textual
argument can be made that section 14606, subdivision (a) permits a plaintiff
43 We have no occasion to consider, and do not consider, the duty of a
seller of a motor vehicle, if any, to inquire into the licensee status of a
purchaser of a motor vehicle, in light of the enactment of section 14604,
subdivision (a).
44 While section 14606 is a criminal statute, the violation of which is an
infraction (see § 40000.1), we conclude that the statute is highly relevant in
determining the scope of common law tort liability for negligent hiring in this
context. (See pt. III.B.2, ante.)
38
bringing a negligent hiring claim to establish that a hirer “knew or should
have known [(A)] that [the hiree] was unfit or incompetent [to drive and (B)]
that this unfitness or incompetence created a particular risk to others” (CACI
No. 426) simply upon proof that the hiree lacked an appropriate driver’s
license.
However, we need not reach such a broad holding to decide this case.
Instead, we need consider only whether McKenna is correct in arguing that
the “requisite ‘amount of care,’ . . . pertaining to constructive knowledge of
unlicensed driving,” as to hirers (see § 14606, subd. (a)) is, at a minimum, “co-
extensive” with that pertaining to owners (see § 14604, subd. (a)). We can
think of no reason, and Beesley offers none, why a hirer who hires another to
drive a vehicle has no duty to make a reasonable effort or inquiry into
whether a prospective hiree is licensed before entrusting the hiree with a
vehicle, given that an owner must make a reasonable effort or inquiry before
permitting a person to driver the owner’s car. 45 Instead, we agree with
McKenna that a person “hiring a worker and entrusting a . . . vehicle to that
worker is . . . analogous to the statutory framework governing owners who
45 Beesley does contend that, because the text of section 14604,
subdivision (a) refers solely to an owner, we should reject McKenna’s
argument that a hirer’s “duty should be ‘co-extensive’ ” with an owner’s.
Beesley contends that we should reject McKenna’s argument because,
according to Beesley, that “is not what the Legislature determined.” We are
unpersuaded. As noted in the previous paragraph, the text of section 14606,
subdivision (a) does not contain any knowledge requirement with respect to
those who “hire . . . [a] person to drive a motor vehicle.” Thus, the text of the
two statutes (§§ 14604, subd. (a), 14606, subd. (a)) does not support the
conclusion that the Legislature intended for a hirer of a driver to be subject to
a less onerous duty of inquiry than an owner who allows another to drive its
vehicle. As explained in the text, a hirer has, at a minimum, a duty to make
a reasonable effort or inquiry into whether a hiree with whom they are
entrusting a vehicle has a license, whether or not the hiree owns the vehicle
entrusted.
39
lend their vehicles to another person.” Thus, we conclude that a hirer has, at
a minimum, a duty to make a “reasonable effort or inquiry” (§ 14604,
subd. (a)) into whether the hiree, entrusted with a vehicle, has an
appropriate driver’s license.
Finally, for the same reasons we concluded that a jury may find the
constructive knowledge element of a cause of action for negligent entrustment
proven by evidence that an owner allowed an unlicensed driver to drive the
owner’s vehicle without making a reasonable effort or inquiry whether the
person has a valid license (see pt. III.C, ante), we conclude that a jury may
find the constructive knowledge element of a cause of action for negligent
hiring of a driver proven by evidence that a hirer entrusted a vehicle to a
hiree and: (1) the hirer did not make any “reasonable effort or inquiry”
(§ 14604, subd. (a)) into whether the hiree had an appropriate driver’s license
and; (2) the hiree in fact lacked an appropriate driver’s license. 46
For the reasons discussed in the following section, we conclude that
there is such evidence in this case.
3. The trial court erred in granting judgment as a matter of law in
favor of Beesley on McKenna’s negligent hiring claim on the ground
that McKenna would be unable to establish the constructive
knowledge element of his claim
A reasonable jury could find that Beesley 47 did not make a reasonable
effort or inquiry into whether Wells had an appropriate driver’s license, based
46 As noted in part I, ante, both negligent entrustment of a motor vehicle
and negligent hiring of a driver are based on evidence of “[a]wareness [by the
defendant], constructive or actual, that a person is unfit or incompetent to
drive.” (Diaz, supra, 51 Cal.4th at p. 1157.)
47 Beesley states in his brief, “it is undisputed that Mr. Beesley did hire
Mr. Wells to perform handyman work at the Beesley residence . . . .” As
noted in part II.C, ante, Beesley assumed for purposes of his motion for
40
on the evidence discussed in part III.C.2, ante, concerning Beesley’s
permitting Wells to drive the Smoothreads vehicle without asking Wells
whether he had a valid driver’s license. Beesley’s argument that “[t]here was
no reason for Mr. Beesley to suspect that a 57-year old man, who had come to
do work driving his own vehicle, would be unlicensed, or otherwise unfit to
operate a pickup truck,” is unpersuasive because, as we explained in rejecting
Smoothreads’s similar argument, a hirer must make a reasonable effort or
inquiry into the prospective driver’s license status, irrespective of whether
the hirer “ha[s] . . . reason to suspect,” that the hiree is unlicensed. As to the
second requirement, it is undisputed that Wells did not have a driver’s
license at the time of the accident.
Accordingly, we conclude that the jury could reasonably find that
Beesley had constructive knowledge that Wells was incompetent or unfit to
drive and that Beesley allowed an unlicensed driver to drive a vehicle. We
therefore conclude that the trial court erred in granting judgment as a matter
of law in favor of Beesley on McKenna’s negligent hiring claim on the ground
that McKenna would be unable to establish the constructive knowledge
element of his claim. 48
summary judgment that Beesley gave Wells permission to use the vehicle
involved in the accident and that Wells was the operator at the time of the
accident.
48 McKenna and Beesley also both make arguments pertaining to a
separate element of McKenna’s negligent hiring cause of action, i.e., whether
Beesley’s negligence in hiring Wells was a substantial factor in causing
McKenna’s harm. For example, Beesley argues, that “there must also be
some relationship between the employment and the negligent act for a claim
of negligent hiring,” and contends that the fact that the accident occurred
outside of Wells’s scope of employment demonstrates a lack of such evidence.
McKenna claims that a negligent hiring cause of action may be brought
against a hirer even where the hiree was acting outside of their scope of
41
IV.
DISPOSITION
The February 28, 2020 judgment in favor of Smoothreads and the
September 6, 2019 order granting Smoothreads’s motion for summary
adjudication are reversed. Smoothreads shall bear costs on appeal with
respect to McKenna’s appeal from the February 28, 2020 judgment.
The October 30, 2019 judgment in favor of Beesley and the September
6, 2019 order granting Beesley’s motion for summary judgment are reversed.
Beesley shall bear costs on appeal with respect to McKenna’s appeal from the
October 30, 2019 judgment.
AARON, J.
WE CONCUR:
MCCONNELL, P. J.
DO, J.
employment. (Citing J.W. v. Watchtower Bible & Tract Society of New York,
Inc. (2018) 29 Cal.App.5th 1142, 1164–1165.)
While Beesley raised a scope of employment argument in his motion for
summary judgment, that argument was directed toward defeating Beesley’s
potential “respondeat superior liability,” a form of vicarious liability not
presented by McKenna on appeal. (See J.W. v. Watchtower Bible & Tract
Society of New York, Inc., supra, at p. 1164 [distinguishing “direct liability”
for negligent hiring from “respondeat superior,” a form of vicarious liability].)
Beesley did not move for summary judgment on the ground that McKenna
would not be able to prove the proximate cause element of his negligent
hiring cause of action, and the trial court granted Beesley’s motion for
summary judgment solely on the constructive knowledge element, and did
not discuss proximate cause in any manner in its ruling. Thus, we have no
occasion to consider the parties’ contentions as to the proximate cause
element of McKenna’s negligent hiring cause of action.
42