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THE INTERPRETATION OF CASE LAW
by James W. Greer, CPCU
When you hear or read about a new case that has recently come out of the higher court, and which has purportedly made significant law, do you rely on others to explain the nature of the case and significance of the ruling, or do you do your own review?
Does your knowledge of liability or work comp doctrinal law and legal practice enable you to analyze these rulings, to distinguish them from prior rulings or rules of law, and decide for yourself their significance? Would you like to be able to do so?
Here’s an example why such knowledge and ability is so important:
On October 26th, 2006 an article, published by the Associated Press and featured in a major work comp online service, cited a decision by the Supreme Court of Maine that has apparently caused a ripple effect among work comp practitioners across that state and around the country. The ruling has been criticized for its “harmful effect on Maine’s economy” and its departure from traditional work comp law.
But is it really? The irony is that the underlying case really isn’t even a work comp case, and the ruling has no effect on work comp practice.
It’s actually a liability case, and even on that line of business the ruling has little practical effect. Nevertheless, practitioners in Maine and in certain parts of the country have apparently construed [and misconstrued?] this ruling as a radical departure from doctrinal law and the dangerous precedent it will set.
Why is this important? What does this particular ruling have to do with anything?
Such a scenario is often painted when one reacts to the opinion(s) of another individual without forming one’s own opinion based on a personal and careful review of the facts and relevant law in a given situation.
Actually, this situation frequently occurs here in Florida and in other jurisdictions. This case is a testament to the importance of both liability and workers’ compensation legal principles and claims practice in the evaluation and disposition of casualty claims. It is also a testament to the importance of doing your own review and interpretation of case law rather than relying on the musings of others.
Let’s take a closer look at the Maine case. Here are the facts:
Justin Laliberte, a warehouse employee for VIP, Inc. in Lewiston, Maine was one of several VIP workers who volunteered to help set up a VIP-sponsored event, the 2002 "Show, Shine & Drag." at Oxford Plains Speedway in Oxford, Maine, located about 45 minutes from Laliberte’s home, and about 20 minutes the other side of the VIP warehouse. (In other words, the employee was required to drive past his employer’s place of business another 20-25 miles before arriving at the racetrack.)
On the morning of the event, he and other hourly VIP employees who volunteered for the assignment were given a T-shirt and $25 for their participation. After spending about an hour at the racetrack, Laliberte was on his way back to his home in Greene, Mainewhen his car veered off the highway and collided with another car, killing Nancy Spencer and injuring her husband and daughter. The Spencers sued VIP, Inc. and Laliberte for damages.
Notwithstanding the fact that VIP’s work comp carrier had accepted the employee’s injury and claim as compensable, Laliberte’s employer, VIP, Inc., filed a Motion for Summary Judgment requesting dismissal from the lawsuit on the basis that Laliberte was “on his way home and not in the course or scope of his employment”, and that Laliberte alone was the responsible party. The trial court agreed with VIP and granted its motion for dismissal, thus denying the Spencers a right to a [liability] trial on the merits. The Spencers appealed.
In a 3-2 ruling, the Maine Supreme Court reversed the lower court’s decision, citing “a genuine issue of material fact as to whether the travel was within the scope of Laliberte's employment”, effectively clearing the way for the Spencers to proceed to a trial on the merits.
So far so good. But then the ruling was publicized...
The Associated Press article and a major online work comp publication cited the ruling as follows:
“In a 3-2 ruling, the Maine Supreme Court overturned a lower court ruling that the collision was not work related, thus upholding workers compensation for Laliberte(emphasis added) and clearing the way for the Spencer's lawsuit against VIP, Inc. In her dissent from the majority, Chief Justice Leigh Saufley criticized the ruling as harmful to the state's business climate, and [that] the ruling could set a dangerous precedent for employers and that it "moves Maine out of step with tort law across the country. The decision of the court today may ultimately cause employers to become the insurer for all harm caused on the highways by their employees while driving to or from work."
Saufley further wrote that while the collision was certainly a tragedy, the Spencers should seek compensation from Laliberte, not from VIP.
What was so harmful about this ruling? How did it depart from traditional principles of tort or work comp law?
Let’s assume this case occurred in Florida...or in California or Texas...do you think it would it be any different? Does this case really say anything? If you were to read it as a Florida appellate case, would you think it significant?
Truth be told, it’s really not significant at all, and here’s why...
First, the lawsuit the Spencers filed against VIP was not a workers’ compensation action. It was, in essence, a liability tort action seeking damages from VIP for the vicarious liability of the employer (i.e. the principal) for the actions of its employee (i.e. its agent).
In fact, there was no dispute over workers’ compensation benefits as VIP had accepted its employee’s accident/injury as compensable, and it would be easy to see why. Traditional work comp doctrine would easily support a decision of compensability in this case, and it is doubtful that any jurisdiction in the country would deny such benefits to the employee. This situation is clearly an exception to the Going and Coming Rule. In fact, one could argue that the Going and Coming Rule doesn’t even apply, as the employee was clearly on a special errand for his employer.
Work comp compensability issues aside, while on the one hand VIP had accepted the occupational nature of its employee’s travel for purposes of workers compensation, on the other hand it simultaneously tried to deny that the employee was an agent of the employer (i.e. thus exposiing the employer to liability under the doctrine of Respondeat Superior or a principle/agent relationship) for purposes of the liability trial.
The trial judge accepted VIP’ argument and granted its motion for summary judgment. This is where the [reversible] error occurred.
A large number of appellate decisions (here in Florida and elsewhere) are simply reversals of Summary Judgment motions granted by lower courts. Are these rulings important? Perhaps. Perhaps not. Quite often one may pick up a little “dicta” (look it up...), but in essence, all such a decision does is remind us of the long standing and very solid principle of the Summary Judgment: It is not to be granted if there is any relevant issue of fact in dispute.
Clearly, in the VIP case, the factual issue of the principal/agent relationship was hotly disputed and never resolved. The fact that compensability had been accepted and benefits were being paid by the employer may have been influential, but it would not by itself be the deciding factor in the existence of a principle/agent relationship.
Remember, this nation’s workers’ compensation benefit delivery system was founded on a set of principles very different from those that dictate “legal responsibility” under the many tort doctrines, and the factors that would support a principal/agent relationship would be based on these differing principles.
What, then, can one take from this case?
First, the ruling in this case is not legally significant. It is merely a reminder of two important issues to both work comp and liability claim practitioners:
- One, to the extent that the facts in this “liability action” present an interesting case study in workers’ compensation, it is no more than a reminder of how one or more of the doctrines of workers’ compensation law should be interpreted.
- Two, if anything, this case is just another reminder that as long as facts are in dispute, Motions for Summary Judgment are not proper and the higher courts will reverse them if granted by the trial courts. Such reversals rarely create new or important substantive law. They simply allow the underlying cases to continue towards trial and, hopefully, a negotiated compromise.
What is important is that this case, like many appellate rulings, reminds us that a “win” gained by the grant of a Motion for Summary Judgment is rarely the end of a case. In a large majority of cases, it merely serves as a signal for the start of meaningful negotiations, and for the “winner” of the motion, a temporary advantage.
As this advantage may soon disappear, if you find yourself such a winner, don’t waste it.
Click here for a copy of: The Interpretation of Case Law
James W. Greer, CPCU
President, AE21 Incorporated
Education & Professional Development Services
(800) 820-4550
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